Sierra Leone and South Africa Essay Example

Sierra Leone and South Africa Essay Example Sierra Leone and South Africa Essay Sierra Leone and South Africa Essay There is no doubt on the potential of the diamond industry to provide benefits and elevate economic and social status of Sierra Leone and South Africa. However, just like in any other industries, problems arise. Perhaps the greatest problem the diamond industry faced was the issue on conflict diamonds. Conflict diamonds started in the war in Angola in 1992. Jonas Savimbi, the leader of UNITA or Uniao Nacional para a Independencia Total de Angola, focused his attention to the vast diamond fields of Angola to find new ways to finance his army and expand his smuggling business (The International Consortium of Investigative Journalists 4).By 1993, Savimbi had the largest diamond smuggling network in the world. And among his associates was South Africa’s De Decker Diamonds, a company that admitted selling diamonds to De Beers. This pattern of laundering diamonds was replicated in other countries especially Sierra Leone (Diamond Facts. Org, The Facts). In 1998, because of the brutal conflict in Sierra Leone, the United Nations started investigating about conflict diamonds and the UN Security Council began imposing sanctions on diamond transactions of countries in conflict.This brought the attention of the global diamond community to the issue of conflict diamonds (ICIJ 4). In 2000, Global Witness, a nongovernmental organization based in London, introduced the term blood diamond to further highlight the issue on conflict diamonds (ICIJ 4). Meanwhile, South Africa initiated the Kimberly Process, a certification scheme to stop the flow of conflict diamonds, in response to the highlighted attention on conflict diamonds and also to protect the country’s diamond industry (ICIJ 5).The issue took on greater implications when, in 2001, media reports provided evidences connecting conflict diamonds to the Al Qaeda attack on the United States (ICIJ 4). Because of the extent and magnitude covered by the issue on conflict diamonds, efforts to control and eliminate this problem through the Kimberly Process required the cooperation of not only South Africa but the entire global community. The United Nations, the international diamond industry and nongovernmental organizations including Partnership Africa Canada, Amnesty International and Global Witness were among the participants.For the first time, a global industry joined forces with governments, the United Nations, and social organizations to deal with a humanitarian issue (Diamond Facts. Org, The Facts). The Kimberly Process was initiated in May 2000. By December 2000, a unanimous vote by all the members of the United Nations General Assembly to support the Kimberly process was passed (ICIJ 4). By January 2003, the K imberly Process Certification Scheme was accepted and made into national law by 52 governments.As of August 2007, membership of the Kimberly Process totaled 74 countries, including Sierra Leone, thus guaranteeing a 99% conflict-free global rough diamond production (Diamond Facts. Org, The Facts). The Kimberly Process presented an international structure where diamonds’ origins are identified and recorded under the backing of the World Diamond Council (ICIJ 5). Rough diamonds crossing international border must come with a government-validated Kimberly Process Certificate and should be enclosed in tamper-resistant containers.Every certificate should be resistant to faking, uniquely numbered and must contain description of shipment contents. Only members of the Kimberly Process are allowed to import and export rough diamonds and should exclusively deal Kimberly-certified diamonds. Contents of the shipment should be checked with the Kimberly Certificate by the importing countryâ €™s customs. It is illegal to export or import uncertified rough diamonds. Confiscation or rejection of parcels and possibly criminal case will be imposed to violators of the procedures (Rapaport 4).The success of the Kimberly Process will be gauged not only on how many of the conflict diamonds are prevented from moving into the international market but also in its effectiveness in checking the proliferation of conflict diamonds from the source of the diamonds itself. In South Africa, though this country was never implicated in the production of conflict diamonds, there were rumors in 2002 that the country was a major laundering center for illicit diamonds especially in Kimberly. This was largely due to sudden resurgence of new diamond discoveries in areas already regarded for years as dry in terms of diamond production.Local diggers suddenly started turning up harvests comparable to a small mine’s production where it used to have only a few carats a month (International Consortium of Investigative Journalists 1). Another reason why the rumor came up was the relative ease by which diamonds were dealt with in the Kimberly Diamond Exchange. Simple invoices were considered adequate for dealers to sell diamonds. No consideration for the origin of the diamond was needed to deal the precious stone. As long as dealers supplying diamonds to the Kimberly Diamond Exchange provide invoices, it is considered legal.Added to this predicament is the difficulty in proving or disproving the origin of the diamond. Although investigations were conducted in Kimberly, there have been no charges filed against anyone dealing in conflict diamonds (ICIJ 2). Possibly the most efficient fuel for the rumor is the government regulatory board’s ineptness to do their duty resulting to laundering of illicit diamonds (ICIJ 3). Monitoring and regulating South Africa’s diamond mining and exportation is supposed to be the South African Diamond Board’s responsibili ty (ICIJ 3).The board neglected their duties when Chris Potgeiter, a shareholder and main contributor in the De Beers exchange Center, declared diamond sales worth $40 million from areas bought from De Beers in 1997. But the areas in question contained no such wealth as described from De Beers’ prospecting notes (ICIJ 3). In Addition, during the period from 1999 to 2001, there were reports that diamond buyers or bourses dealt $360 to $490 million worth of diamonds to the United States. But those diamonds were not examined by the South African Diamond Board which suggested that illicit diamonds were being laundered through the bourse (ICIJ 7).Where diamond authorities were concerned, more often than not, De Beers was most likely connected with the actions of the agencies concerned because of its status in the diamond industry. It is common knowledge that De Beers was the sole entity that started the diamond industry in South Africa. Its influence grew as the industry expanded through time. People in key positions in South African diamond institutions were most likely have direct or indirect link to De Beers. For this reason, doubts emerged whether De Beers was honest on its claim that the company was never touched by conflict diamonds (ICIJ 5).Among the arguments presented, the most intriguing was the cozy relationship between the South African Diamond Board and De Beers. The members of the board and head of various committees were close to the company (ICIJ 8). Allegedly, De Beers used their political influence for the benefit of the company. Benny Steinmetz, one of the most favored sightholders or the elite dealers of De Beers, was influential in South African politics. Steinmetz had connections with South African member of Congress Tokyo Sexwale who, in turn, was a business partner of De Beers (ICIJ 6).Other circumstances that questioned the integrity of De Beers were focused on the diamonds that De Beers purchased from Angola during this country†™s war until its end in 1998 (ICIJ 6). De Beers’ obscured operating procedures made it almost impossible to determine that source of diamond once these diamonds were mixed in its vault and thus made the allegation impossible to prove (ICIJ 6). When the Kimberly process was formed, it was headed by Abbey Chikane of the South African Diamond Board. Chikane had a close relationship with De Beers (ICIJ 8).Because of this situation, speculations on De Beers’ real motives in being active in the Kimberly process erupted. The general assumption was that De Beers was using the Kimberly process to secure hold on the diamond industry because of the growing competition (ICIJ 7). Moreover, the report of the General Accounting Office, the investigative arm of the US Congress, that the Kimberly process was essentially flawed, provided further doubt on the effectiveness of the Kimberly Process to address the problem of conflict diamonds (ICIJ 5).