Written testimony before
The United States Congress
House Committee on International Relations
Subcommittee on Africa
Hearings into the Issue of “Conflict Diamonds”
De Beers would like to thank the members and staff of the House Subcommittee on Africa for their invitation to offer written testimony on the issue of “Conflict Diamonds.” The company is pleased to present its views on the scope of the problem, to describe the unilateral steps it has taken, and to suggest some further solutions that the world’s governments and diamond industry participants might implement to ensure that finds from the sale of illicitly-mined diamonds do not find their way into the coffers of those who would solve their nations’ problems through violence.
II. DE BEERS
De Beers is the oldest and the largest diamond mining company in the world. Established in the Kimberley diamond fields of South Africa in 1888, it owns and operates eight mines in South Africa as well as the offshore and deep-sea diamond mining company, Debmarine. Outside the borders of South Africa it is an equal partner with the government of Namibia in Namdeb, the Namibian diamond mining company; with the government of Botswana in Debswana, the largest producer by value of gem diamonds in the world; and with the government of Tanzania in the Williamson diamond mine.
In 1999 total rough diamond production from these sources was $3.012 billion out of total world production of $6.857 billion. In addition to this production, De Beers marketing and also purchases under contract a proportion of the rough diamond production of Russia and Canada. De Beers’ own production together with goods purchased under contact amounts to approximately 65 percent of world production.
Until October 1999 the company also maintained an outside buying operation, largely in Africa. De Beers was one of hundreds of companies active in this market, of which it had only a small share. The company’s African open market purchases over the last decade accounted for less than five percent of the company’s total intake.
The De Beers marketing arm, the Central Selling Organization deals almost exclusively in rough diamonds. These are sorted into over 14,000 categories, according to carat-weight, cut, color and clarity, before they are sold to the dealers and manufacturers of the international diamond industry at “sights” which are held at five-weekly intervals throughout the year.
De Beers’ customers then take to rough diamonds to the world’s four major cutting centers:
Antwerp, Tel Aviv, New York and Mumbai. The international cutting industry employs 790,000 workers around the world. The largest center is Mumbai in India where the industry gives direct employment to 700,000 people.
Although De Beers is not active in polished diamonds or in the diamond jewelry trade, it supports the retail diamond industry with a vigorous world-wide promotion and consumer advertising campaign for diamonds and diamond jewelry at a cost of $170 million a year. The jewelry industry in the United States is a significant employer, with an important cutting industry in New York and more than 25,000 retail outlets across the U.S.
III. DIAMONDS AND AFRICA
As a company with its roots and many of its assets in Africa, De Beers has a vested interest in the promotion of economic and political stability on the continent. It has therefore long made substantial investments in a wide range of projects to improve the lives and welfare of the peoples of the countries in which it operates. In a five-year period from 1993 to 1998 it spent nearly $90 million on community projects around the world, but mostly in Africa. In 1999 nearly four percent of its dividends were committed to community projects worldwide.
De Beers is therefore dismayed by the continuing conflict in many African states, the suffering of their peoples, and the destruction of those nations’ political and physical infrastructures. Moreover, as a major mining company De Beers knows all too well the deleterious effects that conflict and political instability often have on potential large-scale investors. Diamond mining is a highly capital-intensive field, typically requiring initial capital investments on the order of $500 million or more. Political stability is critical if such commitments are to bear fruit.
Furthermore, having spent hundreds of millions of dollars on advertising its product, De Beers is deeply concerned about anything that could damage the image of diamonds as a symbol of love, beauty, and purity.
For all these reasons, De Beers has been appalled by the link that has been made between diamonds and the funding of weapons purchases by rebel armies in Africa. The company has been particularly saddened because it has first-hand experience of the contributions diamonds can make to a country’s economy through royalties and taxes, provided that they are exploited under an orderly, predictable, transparent and well-regulated mining regime. Such regimes are the norm in those Southern African countries where the diamond industry has been crucial to economic development: South Africa, Namibia and most recently Botswana.
Nowhere has this been more apparent than in South Africa, where the raining industry was the flywheel of the nation’s industrial machine. Before the discovery of diamonds 140 years ago, South Africa was an impoverished, agrarian society. Some of the thousands who flocked to Kimberley at the time were little more than fortune-seekers. Others stayed to create order out of the chaos of the Kimberley diamond fields and to lay the foundation of an industry that has lasted for more than a century. To service the needs of that industry and the later development of the Witwatersrand gold fields, South Africa developed the secondary industries and the physical and financial infrastructure which have ensured its place as the leading industrial country on the African continent.
South Africa is no longer the world’s major diamond producer, although it still produces $0.8 billion worth of diamonds annually. However, the diamond industry still makes a major contribution to the wealth of the country through taxation and employment. South Africa’s diamond industry gives direct employment to 11,500 people, of whom De Beers employs 7,913. In addition to mining, and in sharp contrast to most other producing countries, South Africa maintains a well-developed cutting industry. More than fifty percent of De Beers’ local rough diamond production is sold to South African cutters for benefaction. De Beers is also one of South Africa’s largest corporate tax payers with more than fifty percent of its mining profits going to the State in the form of mining tax.
In Namibia, the organized diamond industry goes back to the end of the First World War. Today, it is the largest single employer and its annual production of 50.4 billion accounts for forty percent of the country’s foreign exchange earnings. Moreover, the orderly development and management of the industry has allowed for the development of its offshore and deep-sea diamond deposits as its onshore deposits have diminished.
Botswana provides the best example of what diamonds can mean to a developing country what its deposits are exploited for the benefit of the many, not the few. Botswana is the largest producer of gem diamonds in the world, producing $1.7 billion worth in 1999. Last year Botswana’s foreign reserves stood at $6.5 billion. With an annual growth rate of nine percent Botswana is one of the fastest-growing economies in the world & it remains dependent on the diamond industry for seventy-five percent of its foreign exchange earnings, sixty-five percent of all government revenue, and thirty-three percent of GDP. Botswana is not merely an economic success story, it is also a rare political success in Africa: a stable, peaceful, multi-party democracy. This political stability ensures that its diamond industry operates within an orderly, transparent and predictable legislative framework, and that all of its citizens benefit from its diamond income.
IV. DIAMONDS FROM CONFLICT AREAS
For all the reasons stated above, De Beers deplores the use of diamonds to kind civil wars. It has consequently gone to considerable lengths — further even than United Nations Sanction 1173 (1998) requires–to ensure that its diamonds are “conflict-free.” The company is also devoting considerable energy to encourage and persuade all involved in the international diamond industry to follow its example. De Beers takes issue, however, with the grossly inflated figures used to describe the dimensions of the problem by some non-governmental organizations and commentators.
De Beers believes that “conflict diamonds” are properly defined as diamonds mined or stolen by rebels who are in opposition to the legitimate Government of a county. As illegal products, it is obviously difficult to quantify them with absolute certainty. According to De Beers’ own research, in 1999 only $255 million of the worlds rough diamond production of $6.8 billion, or roughly 3.7 percent could accurately be described as coming from areas which were under rebel control in 1999 (see Annex 1). 2
The diamond-producing countries most affected by civil war, and therefore the primary source of “conflict diamonds,” are Angola, Sierra Leone, and the Democratic Republic of Congo. The factual bases for the estimates De Beers lists in Annex I for each of these countries are described below.
De Beers estimates that approximately $150 million worth of rough diamonds were produced by areas of Angola that were under rebel control in 1999. This estimate is based on the company’s knowledge about Angolan diamonds, the history of the civil war in Angola, and its effects on the diamond markets in recent years.
Angolan diamonds come primarily from two regions of the country: the Cuango Valley and the northeastern region of Lucapa. Cuango Valley diamonds are typically yellow in color and somewhat rounded in appearance, while those from Lucapa tend to be more angular and grayish-white in color. This distinction is important, as it allows those in the diamond trade to estimate the source of Angolan diamonds with some degree of accuracy.
For most of the period from 1995 to 1997 UNITA was in control of the best areas of the Cuango Valley. During that period, the volume of readily identifiable product from those mines increased substantially on the diamond market in Antwerp. Although the Angolan government does not publish the known positions of UNITA rebels, it is generally accepted that their army withdrew from the diamond-rich Cuango Valley diggings during 1997, during which time the flood of Cuango Valley diamonds into Antwerp ebbed noticeably. This would have effectively reduced UNITA’s potential recovery by approximately fifty percent. If the volumes were larger than the $150 million pet annum estimated by De Beers, the company believes that the goods would spill over into the general diamond trade as they did during the period of 1995-97. Since 1997, UNITA appears to have concentrated itself in the northeast, working some Lucapa-type mines and others further south with which De Beers is not Fami1iar. 3
Finally, further limiting UNITA’s share of the Angolan production is the fact that UNITA’s diamond production is in very few hands (although many dealers try to get into the circuit, very few succeed.) As suggested by U.N. Ambassador Fowler’s report, the UNITA diamond trade is a right limited circle of trusted individuals who provide other services for UNITA beyond diamonds.
B. Sierra Leone
De Beers estimates that approximately $70 million worth of rough diamonds were produced by areas of Sierra Leone under rebel control in 1999. The distinctive rough diamonds of the three diamond regions in Sierra Leone – the districts of Kono/Koidu, Tongo Field, and Kenemal/Bo -are marketed in Antwerp by relatively few dealers, all of whom spent over twenty years in these districts before moving to Belgium when life in Sierra Leone became too precarious. An informal survey of these traders yielded the estimate cited by De Beers in Annex l. 4.
This estimate is based on De Beers’ and the traders’ knowledge of Sierra Leone’s diamond deposits. It has been suggested that Sierra Leone’s alluvial reserves have been seriously depleted after over forty years of mining, and that the proven reserves of the mines at Tongo Field and Koid of Yengema have been overstated to enhance the share prices of small mining companies listed on the Canadian Stock Exchange. Approximately half of Sierra Leone’s total production comes from the Kono/Koidu district, where the larger stones of very fine color and quality are recovered (they are often found in the old tailings left by the defunct S.L.S.T. mining company). If the production from rebel-held diamond regions exceeded $70 million per annum, such a volume of stones would be highly visible on the Antwerp market The production contains a high percentage of crystals — octahedrons with sharp flat sides which produce “Princess” cuts – and such stones are enjoying a surge in demand. A larger volume than that estimated by De Beers and its contacts in the diamond trade would result in highly visible activity among the dealers.
Finally, using Liberian imports into Antwerp as a measure for calculating Sierra Leonian production, as some do, is questionable methodology. Most so-called “Liberian” production emanates from other sources (most notably Russia), and is falsely declared “Liberian” for tax purposes.
C. The Democratic Republic of Congo
De Beers estimates that approximately $35 million worth of rough diamonds were produced by areas of the DRC under rebel control in 1999. At present in the DRC there is only one diamond-producing area of note in rebel bands: Kisangani, in the northeastern part of the country. At the peak of its importance the region produced $50 million per annum and supported approximately twenty small buying companies. At present De Beers’ sources estimate that the Kisangani production is half of what it used to be. However, the company believes that a $25 million estimate may be too low, as some diamonds go out of the CRC to Kigali in Rwanda. This explains the company’s $35 million estimate.
V. PROBLEMS WITH THE “CONFLICT DIAMONDS” CAMPAIGN
Although it shares the concerns of many governments, non-governmental organizations, and commentators around the world about the role “conflict diamonds” are playing in the financing of civil wars in Africa, De Beers has some significant concerns with the public relations campaign being waged by some concerned parties.
A. Inaccurate and unsubstantiated estimates
It has been suggested that twenty percent of the diamonds sold world-wide come from conflict areas. On the contrary, as outlined above De Beers believes that fully 96 percent of world production does not emanate from conflict areas. Half of world production comes from the three success economies in Africa – South Africa, Botswana, and Namibia – where diamond mining is crucial to economic growth, employment and prosperity. Solutions to the problem must deny the flow of funds from diamonds to rebel leaders without damaging the legitimate diamond trade and the constructive role it plays in the economics of these developing countries. Grossly inflated estimates of the scope of the problem do not assist this process.
B. Negative effects on legitimate and economically critical trade
De Beers shares the concerns that have been expressed by countries such as Botswana, South Africa, Namibia, and India (where nearly 1 million people are directly and indirectly dependent on employment in the cutting industry) about the effects of any relentless focus on a very small percentage of world diamond production. Such a campaign could, at best, tarnish the image of diamonds and erode consumer confidence in the product. At worst, it could lead to a consumer boycott, which would destroy the economies of countries like Botswana and Namibia. This point was made by former South African president Nelson Mandela in a statement at the end of 1999, when he insisted that the campaign against “conflict diamonds” should be wary of damaging “this vital industry. If there is a boycott of diamonds, the economies of Botswana and Namibia will collapse.”
C. Persistent confusion over the political history of Angolan diamond fields
A baseless figure of 4 billion is frequently cited as the value of “conflict diamonds” which have found their way into UNITA’s coffers during the civil war in Angola. De Beers believes that this figure is purely notional, and ignores the fact that UNITA would be unlikely to realize even half the value of the stones produced from diggings under its control. Furthermore, this figure does not acknowledge that during the war control of the Cuango and other diamond fields swung regularly between UNITA and the MPLA forces.
This unsubstantiated figure also ignores the fact that from 1990 to 1998 a peace process was underway in Angola, brokered by the United Nations. These efforts by the government, UNITA and the United Nations continued throughout this period until March 1998. when they finally broke down. However, during this period UNITA was brought into the Government of Unity and National Reconciliation as a recognized political party (indeed, the Minister of Mines was himself a member of UNITA). De Beers lent its assistance by, among other things, signing a new sales agreement with the Angolan government in 1991 to help it develop its diamond industry. That agreement included a $50 million loan to help increase alluvial production in the Cuango area.
Sadly, in 1998 the situation deteriorated once again, and by June 1998 all sides had abandoned the peace process. On June 24, 1998 the United Nations invoked full sanctions against UNITK however. De Beers believes that to regard as “conflict diamonds” all diamonds emanating from areas of Angola which were from time to dine under UNITA control during this period muddles history to make a dubious point. De Beers makes no secret of the fact that during this period it purchased Angolan diamonds on the outside market, although it never at any stage bought diamonds from UNITA itself these purchases were made in good faith and under normal and customary market terms. At no time did De Beers attract criticism from the United Nations for its activities, nor did it receive censure from other organizations or commentators. In fact, at no time did the U.N., which was monitoring the peace process, suggest that UNITA was using its diamond funds to re-arm.
D. Recognition & Certification
It has been suggested that one possible solution to the “conflict diamonds” problem lies in the physical identification and certification of all polished diamonds. De Beers contends that this suggestion ignores the complexity of the diamond industry. Furthermore, the company believes that pursuit of this illusory solution detracts focus from the many practical measures which can be taken to reduce or eliminate trade in rough diamonds from conflict areas, and risks further damage to the legitimate diamond industry and the positive role diamonds can play in economic reconstruction and development.
It is possible for a diamond expert to source a complete parcel of rough diamonds as having come from a particular area or region using a number of different clues. For example, artisanal diamonds from the same source will have the same “skin” in the rough, as they have been washed down rivers over many thousands of years. These sources and rivers, however, do not recognize political boundaries. For example, some Angolan production comes from the same sources as some diamonds found in the DRC.
An expert in rough diamonds will look at the parcel of diamonds as a whole. All production, whether artisanal or from a mine, has a ‘footprint” – the proportion of large to smalls, color range, etc. – with which a diamond expert will be familiar. A large parcel of rough diamonds from one source produces a coherent picture, which can be interpreted by an expert to determine whence it came. However, once that picture is broken up it becomes like a jigsaw puzzle with many missing pieces. Identification then becomes a matter of guesswork. It is this kind of expertise which De Beers is willing to offer officials in the Diamond Importation Offices of rough diamond-importing countries to improve vigilance in the granting of import certificates.
While the identification of individual rough diamond parcels can be extremely difficult, marking a rough diamond so that its identity will remain secure throughout the cutting and polishing process is completely impractical, because more than fifty percent of a diamond’s weight is lost in the polishing process. Moreover, the overwhelming majority of diamonds are of a size and quality such that the cost of marking would so erode the margin to the manufacturer as to make it economically unfeasible. (This is particularly so in India – the world’s largest cutting center -which deals largely in small stones.) It is simply not technically possible, nor is it economically feasible, to mark a stone in such a way that the mark will survive from rough to polished, even with advanced laser techniques. Those who offer this as an easy solution are instead offering a golden opportunity to counterfeiters and fraudsterers to pass off conflict or illegal diamonds. This in itself could have the perverse effect of undermining legitimate attempts to curtail the trade in diamonds from conflict areas.
Finally, if only “certificate stones” could be traded, the many millions of diamonds now in (or on) private hands, which have been mined throughout history, could lose their value overnight, with disastrous consequences for the whole of The international diamond industry and millions of consumers round the world.
VI. DE BEERS’ UNILATERAL ACTIONS
De Beers has taken numerous steps to ensure that the diamonds in which it trades are conflict-free, and has adhered strictly to both the letter and the spirit of the United Nations’ diamond sanction of June 24 1998.
- Regarding Angolan production, the company’s outside buying offices — which conducted their business in partnership with the Angolan government through the parastatal Endiama — accepted only those Angolan diamonds that were accompanied by an official certificate of provenance from the Angolan government. In October 1999, moved by concerns over the reliability of sonic of the certificates of provenance, the company went even further, ending its participation in all buying operations in Angola and placing a world-wide embargo on the purchase of all Angolan diamonds by any of its offices.’
- The company subsequently reviewed all of its buying operations in West and Central Africa, because of the possibility that Angolan and Sierra Leone stones could be mixed with other productions and sold through third countries in Africa. The company has since ceased all of its outside buying operations.
- In March 2000 De Beers began to issue guarantees on all invoices that none of its diamonds emanated from conflict areas in Africa. The guarantee reads: “No diamonds in this box have been purchased in breach of UN Resolution 1173. The intake of diamonds being purchased by De Beers and its associated companies and being sold into the market through the Sight system does not include any diamonds which have come from any area in Africa controlled by forces rebelling against the legitimate and internationally recognized government of the relevant country.” As De Beers has stopped all outside buying, and as all of the diamonds it sells come from its own mines in Botswana, Namibia, South Africa, and Tanzania, or are purchased from Canada and Russia, these guarantees are secure.
- De Beers has also announced tat it will not buy diamonds from conflict areas at any time in the future.
- De Beers has announced that it will not sell diamonds to clients found to be dealing in diamonds from conflict areas, and has strongly lobbied both the rest of the industry and the diamond banks who advance loans to the trade to follow its lead.
- Although De Beers withdrew it’s buying operations from Sierra Leone and Liberia fifteen years ago, it recently acceded to a U.S. State Department request to send one of its experts to Sierra Leone to advise that nation on how it can begin to derive financial benefits from its diamond resources for reconstruction purposes.
Above and beyond test measures De Beers has also co-operated closely with the United Nations:
- In January 1999, De Beers wrote to the UN Secretary General confirming its support for UN Resolution 1173 and its commitment to the restoration of peace.
- The company has also offered advice, help and support to Ambassador Robert Bowler and the UN Panel of Experts charged with investigating IJNITA sanctions-busting and the funding of UNITA weapons. Since then it has wised with Ambassador Bowler, the Panel of Experts, and with the US State Department in attempting to resolve the issue.
- The company has also lent support to the British Foreign Office, and has received expressions of appreciation from Ambassador Bowler, the US State Department, and the British Minister in the Foreign Office, Peter Ham.
VII. POSSIBLE SOLUTIONS
Any solution to the “conflict diamonds” problem, first and foremost, must seek to eliminate the trade in illicit (smuggled) diamonds completely. This will require tat governments legislate, establish, and police transparent, orderly and predictable mining regimes. Of course, these regimes require democratic governments and institutions if they are to work properly. It is a necessary, albeit long-term solution.
A more immediate solution would be to make it as difficult as possible for diamonds that emanate from areas of conflict to be hidden in official channels. A suite of suggested solutions could include:
(1) Increase the cost of getting caught. It might discourage some diamantaires if the World Federation of Diamond Bourses and all other trade bodies made a declaration that anyone found guilty of breaking U.N. Resolution 1173 would be banished from all diamond organizations world-wide, even if the case against them was brought after hostilities bad ended and sanctions had been lifted.
(2) Increase government support with new laws. Concerned governments should pass laws to empower their diamond import control offices and officers to refuse entry to wrongly declared or described rough diamonds. Governments should also empower the trade bodies to control their members through the courts.
(3) Build up a reference “library” of local alluvial productions. Each diamond producing country with a potential or actual rebel problem should facilitate the international diamond controlling authorities to acquire, at their own expense, original run-of-mine alluvia] samples from the diamond districts for future reference and distribution among the world’s diamonds cutting centers.
(4) Publish those diamond regions that are “out of bounds.” The Sierra Leone government could publish, for the benefit of international diamond controllers, the positions of rebel troops in relation to the diamond regions of Makeni, Bo, Kenama, Tongo Field, and Koidu districts. The Angolan government should also publish the last known positions of UNITA troops in the diamond regions of Angola, on a quarterly basis. (Those in the diamond trade can spot the difference between Cuango and Lucapa productions if samples are used.)
(5) Tighten the financial restraint on “conflict diamond” dealing. The cutting center diamond banks should agree on a standard, non-conflict diamond declaration form which all of their trade customers would be required to sign and abide by in order to enjoy diamond bank facilities.
(6) Exchange of staff. Staff or experts from alluvial diamond producing countries should spend some time in cutting center import/export offices, to assist and train staff in distinguishing between the origin and provenance of rough diamonds, and to Harmonize the import/export paperwork between those countries. Staff or experts from each cutting center should spend a period of time in alluvial producer countries’ diamond export offices, to familiarize themselves with the physical appearances of the local run-of-mine productions and to establish and harmonize the import/export paperwork, for rough diamonds to and from those centers.
(7) Improve diamond recognition ability as much as possible. Each rough diamond cutting centers diamond importation/exportation office should have samples of the original run-of mine diamond productions, to assist in the task of distinguishing between origin and provenance.
(8) Make the diamond trade more aware of the volumes. The publishing of official annual rough diamond import/export statistics by all countries that handle rough diamonds should become mandatory. Currently, only Belgium publishes a detailed list.
(9) Distinguish between “origin” and “provenance.” At present, it is not a legal requirement to state the source of a stone (origin), but only the country that exported it (provenance). Distinguishing clearly between origin and provenance is therefore a precursor to tightening up the control on the movement of rough diamonds. This could be accomplished through the introduction of a new international standard export/import form, which would make it more difficult to circumvent export/import controls. A standard document, adopted by all centers simultaneously, would have the effect of discouraging the use of official channels by those who wish to conceal the origins of their stones. Penalties for false origin disclosure could include forfeiture of the diamonds.
Measures such as these can help ensure that “conflict diamonds” are forced out of the official channels of the diamond industry, in The same way that the banking industry successfully pushed ding money out of the official banking system.
VIII. ASSISTANCE FROM DE BEERS
In furtherance of solutions outlined above, and in addition to the unilateral actions it has already take; De Beers offers the following assistance to the effort to eliminate “conflict diamond”? as a source of funding for those who would solve the political problems of Africa through violence:
(1) At the request of the cuffing center authorities or their governments, De Beers offers to attach ex-diamond buyers to assist in the process of teaching how to distinguish between the provenance and origin of rough diamonds.
(2) At the request of the international diamond trade, De Beers offers to help in the creation of a new, standardized international import and export document designed to distinguish between the origin and provenance of rough diamonds.
(3) At the request of the diamond banks, De Beers offers to assist in the drafting and implementation of an “International Conflict Diamond Declaration, “to be signed by all diamond bank customers and to have the status of a legally binding undertaking.
(4) At the request of the cutting centers and with the permission of the U.N. Authorities and the U.S. government, De Beers offers to help & ciliate the purchasing of run-of-mine rough diamond samples from all diamond producing areas, which are associated with conflict for retention and reference in all rough diamond cutting centers, world-wide.
(5) At the request of the diamond cutting center authorities, De Beers offers to help train their control experts in rough diamond recognition using samples of run-of-mine productions from the relevant areas in Africa, such as Guinea, Sierra Leone, Liberia, the Ivory Coast, D.R. Congo, and Angola.
De Beers is the world’s leading diamond mining company. It has over a century of experience in the mining of diamonds and in the diamond trade, and it has an enormous amount of history, effort, and resources tied up in the diamond trade. More importantly, our company has its roots on the African continent. We are overwhelmingly concerned with the welfare of Africa’s economies, its resources, and its peoples. We are eager to see the situation resolved, and are therefore pleased to have had this opportunity to offer our thoughts on possible solutions to this Committee.
De Beers stands ready to offer assistance to those who would work constructively towards a solution that cuts off the trade in “conflict diamonds” while protecting the very real gains many African economies have made as a result of the legitimate diamond trade. Along with the members of this Committee and groups of concerned people across the world, De Beers shares a vision of a peaceful and economically strong Africa, and we thank the Committee for its consideration.
|DEM REP OF CONGO||3535||361||396|
|TOTAL WORLD PROD||25555||6.602||6,857|
|CONFLICT PRODUCTION AS % OF WORLDWIDE PROD.||3.7%|
1 De Beers withdrew its buying operation front Sierra Leone and Liberia fifteen years ago.
2 De Beers believes that its sources we more reliable than those that are often cited. For example, official Belgian import statistics are often seriously distorted by the inclusion of diamonds from other countries which are falsely described as “African” in order to avoid the 0.3 percent import levy that Belgium charges on non-African goods.
3 The company notes that these southern Angolan mines produce stones that resemble South African and Namibian goods. Rather than the usual northern Angolan mixtures. This could explain why the diamond trade falls to see. UNITA goods on the market today – they could tally be disguised by mixing and matching them with alluvial production from other countries.
4 The company notes, however, that when speaking at a recent U.S. A. Lb. conference Lawrence N’Dola Myers, the Government Valuator in Freetown, estimated that the production was only $50 million.
5 The important diamond regions of Mass Tslikapa, and Mbuji-Mayi remain in government hands, and account for the bulk of the DRC’s $290 million annual production.
6 This did not include goods from the joint venture mining partnership 5DM. De Beers has a contract with Endiama, the official Angolan parastatal, to purchase SDM diamonds, On March 28 the Angolan Government unilaterally revoked the conflict and announced that it would sell all Angolan production through a new entity. Ascorp, in Contravention of the agreement between Endiana and Pt Been. This agreement included a substantial loan to Endiamn that is still outstanding. De Beers is now pursuing its legal rights.