Reforms Are Helping Africa's Diamonds Sparkle Again
by Marcus Noland, Peterson Institute for International Economics
and J. Brooks Spector, University of Witwatersrand
Op-ed in the Christian Science Monitor
December 11, 2006
© Christian Science Monitor.
The depiction of diamonds and disaster in the new film, Blood Diamond, is the latest horrific tale about Africa. The cinematic history lesson about the now-ended civil war in Sierra Leone may be compelling—but don’t start boycotting diamonds. Today’s mundane reality is that a worldwide coalition of governments, businesses, and NGOs has built a self-policing regimen that is cutting off the “conflict diamond” pipeline.
How diamonds are mined matters. Primary, “deep-shaft” diamonds are expensive to mine. Multinational firms, employing highly unionized workforces dominate production. African nations tax these mines for society’s benefit. Southern Africa accounts for more than 40 percent of world output by value, virtually all produced under these conditions.
Secondary or alluvial diamonds can be extracted from riverbeds with just a shovel and sieve. During political conflict, these easily lootable stones have helped finance civil wars in countries such as Sierra Leone and Angola. Anticipatory concern centers on the uneasy peace in Ivory Coast. Conflict diamonds have also been linked to al-Qaeda's financial activities.
With these challenges in mind, South Africa, Botswana, and Namibia initiated talks in 2000 with major importing countries and representatives from NGOs and the diamond industry. Together, they created the Kimberley Process, an international certification system. Since it began, conflict diamonds have fallen from 15 percent to less than 1 percent of the trade.
Is there more to be done? You bet: The US Government Accountability Office has recommended improvements in America’s domestic diamond surveillance system, enhanced capacity for tracking the activities of US certified licensees abroad, and expanded diamond-related assistance for the most heavily affected countries in west Africa. The latter has begun via the Diamond Development Initiative, a global effort to improve the grim lives of artisanal miners who legally dig the alluvial stones.
Consumers can do their part by buying gems from reputable retailers. They should ask where the stones were imported from, where they were mined, and insist that they meet Kimberley criteria.
But boycotting them for fear of supporting conflict in Africa would be counterproductive. Take Botswana. It’s a thriving democracy that has the world's second-highest HIV infection rate. Diamonds generate half of its government’s revenue. The national producer, Debswana, plays a vital role in Botswana’s medical care, including the free provision of antiretroviral drugs. The implications of a major contraction from a boycott in the diamond industry would be dire.
© 2014 Peter G. Peterson Institute for International Economics. 1750 Massachusetts Avenue, NW.
Washington, DC 20036. Tel: 202-328-9000 Fax: 202-659-3225 / 202-328-5432
Site development and hosting by Digital Division