De Beers pledges not to trade in 'blood diamonds'
by Allan Robinson - Wednesday, March 1, 2000
globeinvestor.com
De Beers Consolidated Mines Ltd. wants the buyers of its diamonds to know their money is not being used to help finance bloody insurrections in Africa.
The diamond industry has contended for years with international criticism that what are referred to as "blood diamonds" have been used to finance guerrilla movements in countries such as Angola, Sierra Leone and Congo.
De Beers said yesterday that beginning March 27 it will provide written guarantees to buyers of its rough stones that no diamonds in the boxes up for sale were acquired from "any area in Africa controlled by forces rebelling against the legitimate and internationally recognized government."
The world's leading diamond producer will also provide a written guarantee that "no diamonds in this box have been purchased in breach of United Nations Resolution 1173," which aims to block the sale of diamonds by UNITA rebels, the National Union for the Total Independence of Angola.
De Beers, through its Central Selling Organisation, sells its rough stones to dealers 10 times a year at "sightings" in London, Johannesburg and Lucerne by presenting the dealers with boxes of rough diamonds on a take-it-or-leave-it basis. The rough diamonds are then cut in preparation for sale by jewellers.
The diamonds are purchased by De Beers and its associated companies and sold through the sight system. The CSO accounts for almost 70 per cent of rough diamond sales.
"We're not taking the initiative for marketing reasons," said Tom Beardmore-Gray, senior vice-president of De Beers Canada Corp. of Vancouver. "We're taking the initiative in the spirit of helping the United Nations' efforts."
De Beers says it has stopped buying diamonds in Angola "from the informal sector of the economy" and has withdrawn its buyers in Congo and Guinea. De Beers has not had offices in Sierra Leone and Liberia for 15 years.
The company said no decision has been made about whether its advertising campaigns might use these initiatives as a selling feature to the retail market. "It's very difficult to predict what might or might not happen in the future," Mr. Beardmore-Gray said. "It's far too early to really comment on that."
De Beers acquires its diamonds from South Africa, Botswana, Namibia, Russia and Canada.
Alex Vines, a researcher for the African division of Human Rights Watch in London, said that while De Beers is "trying to go up-market" by supporting the United Nations sanctions, an Israeli company has moved into the market left in Angola. "It does worry me that other companies will move in."
Charmian Gooch, the director of London-based Global Witness, a human rights group, said it has yet to be determined how De Beers can audit its guarantee, especially after it "has spent decades claiming that it has an essential role in buying just such unofficial diamonds in order to maintain a stable world price for the commodity."
"The focus of attention must now be on the many thousands of jewellery retailers worldwide, the key sector of the diamond market most closely in contact with consumers, to ensure that they also do not supply diamonds originating from rebel-held areas," Mr. Gooch said. |
