I was jogging on a treadmill at the gym last week when I spotted images of diamonds on Sky News on one of the club TVs.
Now diamonds don’t make it onto the mainstream news channels too often so I hurriedly tuned in so that I could watch and listen to the report.
The subject was the meeting of something called the ‘Kimberley Process’, taking place in Israel last week, and more specifically the diamond industry response to what’s been happening in Zimbabwe.
A bit of background: like most of its neighbours, Zimbabwe is a diamond-producing country, but not a major one in global terms.
When industry website IdexOnline published its overview of the 2009 diamond ‘pipeline’ earlier this year it estimated that Zimbabwe produced around 2.5 million carats of diamonds at a value of perhaps $80 million – that’s just less than 1% of their estimate of the total value of global production last year of £8.46 billion.
Now Zimbabwe might be producing rather more than that – it’s hard to tell (of which more in a moment).
But then again last year was a lean year for diamond production because major producers such as De Beers cut back massively, wisely deciding that if they were going to struggle to sell the diamonds then they would be better off leaving them in the ground.
According to Idex, global production in 2008 was $14.8 billion, in which case this ‘theoretical’ Zimbabwe production of $80m would be around 0.5% of the global total.
Zimbabwe’s production is so hard to quantify because of the failings of both the Zimbabwe regime and the Kimberley Process.
The Kimberley Process was set up by the diamond industry and relevant governments and NGOs to stem the flow of conflict diamonds – the sort of thing that was depicted in the movie Blood Diamond starring Leonardo DiCaprio and set in Sierra Leone in the late 1990s when that country was ravaged by civil war.
The Kimberley Process has scored some notable successes over the last decade but it has failed in respect of Zimbabwe, and that’s partly because what’s been going on there is not a civil war or a ‘conflict’ in the same sense that conflicts took place in Zaire (now DR Congo), Angola, and Sierra Leone.
But the absence of an overt conflict in Zimbabwe does not mean that all is well there in the diamond trade – far from it.
You can find the gory details elsewhere, but there have been credible reports of killings by security forces, forced labour, child labour, and the imprisonment of a human rights activist.
And it almost goes without saying that the brutal Mugabe regime is mixed up in all this, with allegations that people around Mugabe are profiting handsomely from the nation’s lucrative diamond resources.
The response from the Kimberley Process regulators was to ban exports of diamonds from Zimbabwe, and they helpfully circulated images of uncut diamonds from Zimbabwe (below) to help traders recognise them.
- Rough diamonds from Marange in Zimbabwe
But of course diamonds are all too easy to smuggle, and nobody believes that banned Zimbabwe diamonds are not leaking out into the legitimate diamond trade where unscrupulous traders (and there too many of those…) will mix these illicit diamonds into parcels of diamonds from legitimate sources.
To make things worse, the Zimbabwe Government brazenly declared this week that it planned to sell its considerable diamond stockpiles anyway, regardless of the Kimberley Process ban.
Meanwhile the regulators meeting in Israel failed to agree on a way forward, so the meeting ended in deadlock and the issue was kicked into the long grass until their next meeting to be held in St Petersburg.
Why are we telling you all this?
Well you probably won’t hear about this sort of thing on other consumer-facing diamond & jewellery websites, and if you walk into a jewellery boutique they’re unlikely to volunteer this information to you; if you do ask them about Zimbabwe and diamonds they’ll most likely look at you blankly because they don’t know enough to comment or to offer you convincing reassurance.
The diamond industry doesn’t like to shine a light on its own shortcomings (who does?), and of course the risk for the industry is that consumers recoil from diamonds altogether and choose to spend their precious cash on something else.
We know this, but we believe that people want and deserve more and more transparency about the products that they buy (or rent!), so we’re prepared to learn as much as we can about what’s going on in places like Zimbabwe, and to write about it so that you have accurate information and can make an informed decision.
The diamond industry is embarrassed by Zimbabwe and would like to solve the problem, but politics and bureaucracy and conflicting interests and corruption prevent that from happening, and the Kimberley Process seems impotent and unable to come up with the answers.
In a way, they’re damned if they do and damned if they don’t, and we don’t envy them their task.
If exports from Zimbabwe are resumed then the revenues from diamond sales will flow into the hands of the brutal Mugabe regime and the industry will be seen to approve of – or at least tolerate – the conditions in which the diamonds are being mined.
But under the export ban diamonds are leaking out of the country anyway, revenues are ending up in many of the same corrupt hands, and conditions on the ground don’t improve.
Meanwhile, the violence and lawlessness of the Marange diamond fields ensure that Zimbabwe continues to be an affront to democracy and a stain on both the diamond industry and the Kimberley Process.
It doesn’t matter that it’s only 0.5% or 1% of world diamond production. Diamonds are emotive and women buy or wear diamond jewellery because of how it makes them feel.
Zimbabwe is an important test for the Kimberley Process and last week it failed that test.
We just thought you should know.
original post here
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