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Editorial

Dec 16, 2011 12:50 AM   By Avi Krawitz
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RAPAPORT... The recent withdrawal of Global Witness from the Kimberley Process Certification Scheme (KPCS) generated much press coverage and interest. The move was inevitable but timely.

The group’s frustrations reached a tipping point in November when the KP approved exports from the [still] controversial Marange fields, seemingly putting the protracted debate about Zimbabwe’s participation in the scheme to rest. More significantly, the announcement came in the midst of the busy Christmas shopping season. 

Whether Global Witness intended to impact Christmas demand is uncertain, but its message to consumers was clear. “Consumers should not buy Marange diamonds, and industry should not supply them,” said Charmian Gooch, a founding director of the group. “Consumers have a right to know what they’re buying and what was done to obtain it.”

In addition to Zimbabwe, Gooch outlined the KP’s failure to deal with the trade of conflict diamonds in Cote d’Ivoire and Venezuela’s disregard for the rules. She charged that the KP’s inability to address the links between diamonds, violence and tyranny have rendered it outdated.

While industry organizations labeled the Global Witness decision as “regrettable” and thanked the group for its contribution over the years, the obituaries may be premature. If anything, this move by Global Witness may just have renewed its relevance and repositioned it as an important player in the conflict diamond debate.

Certainly, Annie Dunnebacke, a Global Witness campaigner, stressed that the group was in no way stepping away from the issue. She told Rapaport News that the non-government organization (NGO) will now be better able to refocus the discussion away from the technical issuance of KP certificates, which she added have become meaningless and do not hold much value. Rather, Global Witness will want to see a more industry-focused approach, she said.

That might include adopting standards set by the Organisation for Economic Co-operation and Development (OECD) and other bodies like the United Nations Security Council in the mineral sector that provide guidance on performing due diligence along the supply chain, be it in conflict or high-risk areas. “It’s the diamond companies that are deciding from whom to buy diamonds and where to put their money and that really hold a lot of leverage over the supply chain,” Dunnebacke said. “So we would like to see the diamond industry meet some of those standards that have been developed internationally.”

Global Witness is not alone in its call for reform. The remaining members of the KP civil society coalition have outlined the reforms they want to see addressed by the scheme in 2012.

The coalition wants to broaden the definition of a conflict diamond to include the violation of human rights. It also wants to see the introduction of an independent monitoring facility; the inclusion of the cutting and polishing sector in the KP oversight and statistics; clearer responsibilities for industry throughout the supply chain; and clearer language supporting the role of civil society in monitoring compliance. In addition, the NGO’s want the KP to implement a more effective decision-making mechanism, greater transparency, KP administrative support, tougher consequences in place for non-compliance and a stronger focus on development.
 
In short, they’re pretty much on the same page as Global Witness. But they differ in how to go about effecting the changes they seek.

With the Zimbabwe issue expected to occupy less time and interest at KP meetings from now on, some see 2012 as an opportunity to move forward on the reform agenda – especially with the United States as KP chair. Eli Izhakoff, president of the World Diamond Council (WDC), which represents the industry at the KP, argued that Global Witness would have had far more clout sitting at the negotiating table. Global Witness clearly disagrees and believes it will be freer to act independently.

That may be so. It is often more effective to have a group with a voice like Global Witness outside the system, pushing for stronger awareness and reform.

Consider Survival International’s campaign against the proposed De Beers Gope mine development in Botswana’s Central Kalahari Game Reserve during the nineties and in the early part of the last decade, which the group said infringed on the rights of a local Bushmen community. Survival recruited celebrities to garner support for its cause. The campaign ultimately forced De Beers to divest and sell the project to Gem Diamonds, which has been meticulous in dealing with the issue and rebranding the mine in a more positive and ethical way.       

Somewhat surprisingly, the KP stalemate over Zimbabwe failed to inspire a similar reaction, especially in light of the growing importance of ethical concerns among today’s consumers. One would have expected more of a consumer backlash against the industry, or at least against Zimbabwe diamonds. After all, few would take lightly the manner in which government forces seized control of the Marange fields in 2008, killing an estimated 200 miners in the process. Consumers were possibly too engulfed in the financial crisis at the time to worry about buying diamonds at all, let alone where they came from. But perhaps civil society’s involvement in the KP also prevented any group from acting in a meaningful way. Global Witness now has that opportunity and could have the intention.

Dunnebacke would not say. Some argue that the moment has passed. Izhakoff stressed that the situation in Marange has vastly improved due to the efforts of the KP. “Any campaign has to be based on the facts of what is happening currently, not three years ago,” he told Rapaport News. “We already prohibited Zimbabwe based on its human rights abuses that took place in 2008 but our latest review missions and the KP monitors there have shown that great improvement has been made and there are no violations taking place today. Our challenge will be to do the right thing and consumers will judge us accordingly.”

Global Witness stated that the Zimbabwe issue runs deeper than the atrocities committed when the government seized control of the Marange fields in 2008. Expressing concern that the ownership of the various mines in the Marange fields is legally questionable, Global Witness noted that revenues from the operations are likely being channeled to associates of Robert Mugabe’s Zanu PF party. Furthermore, members of state agencies aligned with Mugabe are said to benefit from off-budget diamond revenues, even though they are accused of violence against opposition party supporters.

“As the country approaches another election there is a very high risk of Zanu PF hardliners employing these tactics once more and using Marange diamonds to foot the bill,” Gooch said. “The Kimberley Process’s refusal to confront this reality is an outrage.” Similar questions can be asked of other African regimes.


Actions from some governments such as the U.S., which this week added Mbada Diamonds and Marange Resources, the respective owners of mines in Marange, to its list of sanctioned entities, may have eased consumer concerns in their respective markets. But the U.S. will walk a fine line in the coming year as KP chair. Individual companies, such as De Beers and the Rapaport Group have implemented their own trading requirements (see Rapaport Trade Alert here).

How Global Witness confronts the current reality represents a stern test for the group. Its effectiveness or lack of success will impact the remaining NGO’s strategies to work within the KP. Given the Kimberley Processes’ track record of implementing reform, Global Witness’s voice may highlight the coalition’s frustrations. But having made its move, it will now be up to Global Witness to set the tone of the debate. Either way, having a competitive civil society sector pressing for reform and improvements in dealing with the conflict diamond issue is good for both industry and consumers, not to mention those victims of human rights abuses.

The writer can be contacted at avi@diamonds.net.

This article is an excerpt from a market report that is sent to Rapaport members on a weekly basis. To subscribe, go to
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Tags: Avi Krawitz, Conflict Diamonds, diamonds, Global Witness, Kimberley Process, Marange, NGO, Rapaport, Zimbabwe
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Dec 16, 2011 5:43PM    By Sean Clinton
While the diamond industry wants to ring-fence the blood diamond issue inside the mining sector that is becoming increasingly difficult as more people learn about the human rights violations funded by revenue from the cut and polished sector. Given that revenue from the diamond industry in Israel is a major source of funding for the Israeli military which stands accused of war crimes and possible crimes against humanity by the UN HRC, any move to expand the definition of a conflict diamond to included human rights violations funded by cut and polished diamonds will be resisted by Israel. However, consumers are the final arbiters and they will dictate what is and what is not a blood diamond.
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