Founder pulls out of ‘failed’ Kimberley Process

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A founding member of the Kimberley Process, the diamond-industry initiative set up to end trade in conflict diamonds, has dropped out of the initiative, citing “outrage” over a decision to allow exports from the vast Marange deposit in Zimbabwe.

Global Witness, the civil society group, was one of the first organisations to document the “blood diamonds” that helped finance violent struggles in Sierra Leone and Angola in the late 1990s. In 2003 it was a co-founder of the Kimberley Process, which awards certification to countries that adopt its rules concerning the exploitation of diamonds. No member country is allowed to import diamonds from a non-member country.

“The scheme has failed,” Global Witness said on Monday, announcing that it would drop out. “It has become an accomplice to diamond laundering,” the organisation said in a statement.

The World Diamond Council, a trade body, hit back. “The overriding goal of the Kimberley Process certification scheme has been to protect the integrity of the diamond,” said Eli Itzhakoff, president, in a statement. “The system is not perfect and is in need of constant review. However, you cannot contribute to the process if you are no longer engaged.”

The public row comes after years of controversy surrounding the status of Zimbabwe’s Marange diamond deposit, which is so large that it could flood the market with gems if they were mined and exported professionally. The debate over whether they constitute “blood diamonds” has riven the industry.

The top committee of the Kimberley Process – which includes more than 70 countries, producers such as De Beers and non-governmental organisations – met in Kinshasa in early November. It allowed two joint-venture companies to export diamonds from Marange and opened the way to wider exports.

“The plenary endorses production from the compliant mining operations of Marange Resources and Mbada with immediate effect,” a resolution stated.

Global Witness says the two companies have links to Zanu-PF, the party of President Robert Mugabe. Zanu-PF is credited with a violent crackdown on a diamond rush at Marange in 2008 that left an estimated 200 people dead. Critics say Zimbabwe, a signatory member of the Kimberley Process, should have been suspended after the crackdown, but it remains a member.

The decision in Kinshasa was “a final nail in the coffin”, said Annie Dunnebacke, senior campaigner at Global Witness. “It completely stripped the Kimberley Process of all credibility.”

“The [Marange] resource base probably is the best chance that Zimbabwe has had in a long time to raise money for development that could benefit the Zimbabwean people,” she added. “Instead, with the legitimisation of the Kimberley Process, the money appears to be going to high-ranking individuals in Zanu-PF.”

A board member of the World Diamond Council disagreed. “We’re all concerned about what has happened in Zimbabwe over the past three years,” the board member said. “There has been progress, although not as quickly or sustainably as we would like. But it is a gross exaggeration to say nothing has been done. If you look at it, the Kimberley Process is one of the only organisations that has had an effect on changing the government’s behaviour.”

However, analysts say the case of Marange has challenged the core principles of the initiative.

“Though discovered by villagers in 2006, it only recently sank in that [Marange] is the single-largest diamond find in the past two decades,” wrote Chaim Even-Zohar, head of Tacy, the diamond industry consultancy, in an essay shared with the Financial Times last year.

Mr Even-Zohar estimated Marange could produce 35m-45m carats per year. “This would make Zimbabwe the top diamond producer in the world in terms of volume.”

“Zimbabwe, however, is severely testing the Kimberley Process certification scheme management ability, as humanitarian crimes committed by a legitimate, autonomous government against its own population don’t fall under the [scheme’s] definition of ‘conflict diamonds’,” he said. “The scheme only covers rough diamonds used by rebel movements or their allies”.

Global Witness also cited situations in Ivory Coast and Venezuela as reasons for its departure from the initiative.

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