Post-war stringent diamond mining rules have bolstered export earnings in Sierra Leone, but the country’s nationals, rated among the poorest in the world, are yet to benefit from the boom.
Diamond exports, the West African country’s major source of hard currency earnings, have increased fivefold in as many years, according to official statistics.
But the increase in exports has not had a proportionate effect on the standard of living of ordinary Sierra Leoneans, more than 70% of whom remain below the poverty threshold, economic and social commentators say.
After rebels occupied the principal diamond sources in 1991, the country’s net export earning industry collapsed. Income from exports dwindled from $17-million a year before the war to $1,5-million per year in 1999, according to the government’s chief gold buyer and valuer Lawrence Ndola-Myers.
With the agreement of the United Nations, Sierra Leone introduced in 2000 a certificate of origin in a bid to stop illicit trading in diamonds. This is known as conflict diamonds in reference to their use in fuelling civil wars in the region.
The international diamond tracking system known as the Kimberley Process Certification Scheme came into being in October 2000 and within the last quarter of that year exports shot to $10,3-million.
Since then exports have been steadily growing. In 2001 exports went up to $26-million, nearly doubled the following year to $41-million, then in 2003 went up to $76-million. In 2004 export revenue shot up to $126-million and hit $142-million last year.
”It’s a huge jump because there is complete control in the diamond sector,” said Ndola-Myers who is also general manager of the government gold and diamond office in the country’s central bank.
Ndola-Myers further attributes the rise in exports to other strict controls and monitoring by government officials.
Economist and university of Sierra Leone lecturer Samuel Jamiru Braima, blames the mining laws for the small impact of the boom on ordinary Sierra Leoneans.
”The bulk of the diamond business here is being done by foreigners,” said Braima, adding ”The amount of foreign currency that the government realises from these proceedings is so minimal, and amounts to a pittance compared to the vast mining area communities.”
The government receives three percent of all exports earned by merchants and from that 0,75% is ploughed back into mining communities for infrastuctural development projects such as roads and schools.
Braima is calling for a review of the mining laws and composition of companies operating in the diamond industry to afford Sierra Leoneans a stake.
Under current law, anyone who can raise $40 000 for a licence fee can be registered as an official dealer.
Miners and dealers are strictly monitored and must adhere to stringent regulations. To avoid illicitly-gotten money getting into the system, government insists that merchants declare their source of funding and must handle all their transactions through a traceable banking system.
Sierra Leone sits on a huge deposit of diamonds that could rake in about $200-million annually, but for a decade in the 1990s the gem lost its sparkle when it was used to finance wars in the region.
Diamonds fuelled Sierra Leone’s rebel war with Liberian former president and warlord Charles Taylor accused of supplying arms and training rebels in exchange for ”blood diamonds”. Taylor now faces trial for war crimes and crimes against humanity and is being held at a United Nations-backed war crimes court in Freetown.
Opposition politicians blame the lack of tangible development despite the mineral resources on lack of good governance and corruption. – Sapa-AFP