Despite their notorious reputation, ”conflict diamonds” make up less than 1% of the global trade in the sparkling gemstone, according to a South African report released on Wednesday.
However, the report by Business Leadership South Africa, an association of the country’s top executives, warns that consumer concerns over conflict diamonds ”pose a long-term threat to the industry”.
The illegal trade in ”conflict diamonds” — sometimes known as blood diamonds — has fuelled and funded wars in Africa, killing millions in Angola, Sierra Leone, Liberia and the Democratic Republic of Congo.
Films like Blood Diamond, featuring Leonardo DiCaprio, has helped bring attention to the issue and put industry players such as South Africa’s De Beers on the defensive.
The company, which is the world’s largest producer of diamonds, is also part of the association that funded the report.
Titled The Stuff of Legends, the report examines diamonds and development in Southern Africa. It says there has been a decline in the amount of conflict diamonds being traded, from about 15% in the mid-1990s.
This is due to efforts such as the Kimberley Process, which aims to stem the flow of conflict diamonds by forcing participants to certify the origins of the diamonds being traded, as well as progress in resolving political tensions in many African countries.
”Conflict diamonds have been largely, if not completely, contained,” said one of the authors, Brooks Spector.
Spector said conflict diamonds continue to stem from West African countries such as Ghana and Tanzania and stressed the political concerns underlying the trade in illicit diamonds. ”It is not diamonds that cause wars. Wars and conflict lead to unregulated trade in diamonds,” he said.
According to the report, Southern Africa accounts for more than 40% of the world’s diamond output, with Botswana being the world’s largest producer of the gem. Russia is the second and South Africa the third.
Other problems
While the report notes the absence of conflict diamonds from Southern Africa, it acknowledges that diamond mining in the region is dogged by other problems.
The South African government is to pay $25-million to the Richtersveld community following a dispute over land it was forced to leave after mineral rights were awarded to Alexkor, a state-run diamond-mining company, in 1927.
And in Botswana, a ruling is expected on December 13 on claims by Bushmen that they are being forced off their land by Debswana, the partly state-owned company that controls the country’s mines along with De Beers.
However, the report says the diamond industry has ”been a positive force for development in Southern Africa” by creating jobs, bringing in foreign exchange and contributing to the building of infrastructure.
It says that while the ”general judgement that the Southern African mining companies were poor corporate citizens” had been valid, today revenues from the diamond industry fund a broad array of social services. This includes HIV/Aids programmes run among mining communities by companies such as De Beers.
The report also says partial public ownership of corporate assets in Botswana and Namibia, as well as black economic empowerment programmes in South Africa, has meant that the benefits of diamond mining are being increasingly shared.
De Beers spokesperson Tom Tweedy welcomed the report. ”It is a good thing we are being scrutinised. It is a good thing that diamonds are being scrutinised. But it can also be blown out of proportion. One can celebrate or castigate the Kimberley Process, but it is the only process out there,” he said. — Sapa-AP