Diplomatic approach to diamonds
GNWT trying to negotiate solution to value-added dilemma
Richard Gleeson
Northern News Services
NNSL (May 17/99) - The territorial government appears resigned to negotiating
with Diavik rather than arguing with the federal government.
Minister of Resources, Wildlife and Economic Development Stephen Kakfwi last week
said he is determined to negotiate a settlement of the secondary diamond issue.
Three weeks ago Kakfwi's deputy minister publicly criticized Department of Indian Affairs
and Northern Development's refusal to address secondary diamond industries in its
environmental review of the proposed Diavik Diamond mine.
"I think one of the prerequisites for doing good business is having a good relationship with
everyone involved," said Kakfwi on Thursday, "and we are very involved, as the elected
representatives of the people of the Northwest Territories."
Kakfwi would not say whether or not the government is considering using the threat of
exorbitant taxation, as it did when negotiating with BHP, to bolster it's bargaining position.
"If Diavik thinks just taking the diamonds is good business, we have a major difference to
overcome," said Kakfwi.
Responding to questions from Yellowknife Centre MLA Jake Ootes earlier in the week,
Kakfwi said he and his officials are currently attempting to negotiate a socio-economic
agreement with the company.
The minister said formal negotiations of the agreement began "a few months ago."
Kakfwi noted Diavik has said it had no objection to selling rough diamonds to Northern
manufacturers as long as it made good business sense.
Hay River Mayor Jack Rowe said the value-added dispute has served to highlight the
need for the North to take control of its resources.
Rowe said his understanding is that the federal government's reluctance to compel Diavik
to provide rough diamonds to Northern-based cutting, sorting and polishing companies is
because it may violate international trade agreements they have signed.
"If this was a provincial government, they could consider those options because they are
not signatories to those agreements," said Rowe.
Rowe said the standard for negotiation was set last year, when BHP agreed to sell 7,500
carats of diamonds a month to Northern companies.
A Northern Accord, said Rowe, would benefit both the territories and the companies
who hope to do business here by defining clearly the rules, and the costs, of doing
business in the North. |
