The Diamond Trade in 2007: How Much Blood Remains?

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In March, 2007, I traveled to Turkey, where I attended the Istanbul Jewelry Show. There I met a diamond dealer, the president of a large firm with a large booth. He was the brother of a personal friend and had been in the diamond industry for many years. His primary business was the Russian market, the fabulously rich oligarchy which has a large appetite for bling. The larger, the better.

“How much do conflict diamonds still enter the supply chain?” I asked.

“A huge amount,” he said. He didn’t trade in these stone, but his customers were not so concerned about the issue. By stating that much of the world diamond market does not care much whether diamonds are from conflict zones or not, he merely confirmed what NGOs such as Global Witness, who broke the conflict diamond story, have said for years.

Blood Diamonds Still Enter the Market

If someone brings a pocket full of uncut diamonds to the back alleys of Mumbai, Antwerp or New York, they will find a way into the supply chain. Amnesty International, states that conflict diamonds are still being widely circulated. No one knows how many thousands of women wear engagement rings purchased some time in the last fifteen years that funded the deaths of 3.7 million Africans. The sourcing of diamonds has too often embodied the opposite of what diamonds represent, when a person falls to his or her knees to propose to their beloved.

The Kimberly Certification Process has definitely affected the trade of blood diamonds. It is an honest and valiant attempt by the international diamond industry to regulate the trade while continuing to have some control of the market, which is in their interest.

However, the Kimberly Process is self enforced, the practices in the diamond industry are highly secretive and there is no system of independent, periodic reviews of signature countries. Diamonds can change hands many times before they reach the jeweler. It is impossible for the sector to close all of the potential holes in the supply chain; from mine to market.

Blood Diamond: Symptoms of Much Greater Issues

Blood diamonds are merely a symptom of much greater issues, though. The current war and destruction in Africa are the result of the colonial policies that destroyed complex cultural structures – the racist, dehumanizing commoditization of people and resources that even now still fatten the economies of the developed world.

For blood diamonds to not exist, we would have to eliminate poverty and injustice in the war torn African countries that are too much in chaos to reap the benefit of this resources. No single government or trade organization can stop this. Love, compassion, fairness and equality would have to be more important than the current relentless greed that drives human misery.

Now, add to the above another issue in the news last year: certification. Last year GIA, was implicated in a grading scandal that rocked the industry. Even a slight variance in grading can mean millions of dollars in a parcel of diamonds. The issues have been resolved and people have lost their jobs and their reputations. Yet recently, when looking to purchase a diamond, an industry insider remarked that certain labs are “softer” in their grading of diamonds than others. This is not the first anecdotal evidence I have heard that has led me to believe that the grading of diamonds is not as objective it is made out to be.

There are extremely wide ranging views on these issues, and many people in the jewelry trade would probably dispute what I write here. Diamonds represent over 50% of the business for the jewelry industry as a whole. For my company, it is less than 10%. I have less to lose in giving my candid insider’s opinion, but it is only an opinion, a snapshot; and I would never pretend to be an authority on this subject.

From the point of view of ethical purchases, the obvious solution for some is to avoid the African supply chain. You can purchase diamonds that are certified from Canada. However, many African countries depend upon legitimate diamond trade, so the ethics of boycotting African diamonds has its drawbacks.

Even Nelson Mandala asked that African diamonds not be boycotted. Ironically, he has become a spoke person for De Beers. De Beers itself has taken on new development initiatives in an attempt to polish their image.

Blood-Free but Still Not Fair Trade

Just because a diamond is from a Kimberly certified source does not mean that it is something that you can feel proud of owning it, as this New York Times article entitled: “Diamonds Move From Blood To Sweat And Tears.”

The Kimberly process is regulatory program. It does not address wages or environmental conditions. At present, there are over a million, perhaps as many as 1.3 million diamond diggers. Most of these people are poor. They are often paid under market for their finds. Diamond areas can be as large as a hundred square miles. Even in established mines, as much as 20% the diamond rough may be lost to theft.

The Quest for Fair

The decision of where one should purchase their diamonds can leave the ethical consumer in a “Catch 22.” The most worthy viable, ethical solution is to push for ethically sourced, or “fair trade” diamonds now. Already, there are strong industry initiatives to change the way diamonds are mined. One of the most noteworthy is taking place right now in Sierra Leon. However, most diamonds from mines that have strict environmental and fair labor protocols, such as those produced by Wade Watson in Sierra Leon, are mixed in with other diamonds in the diamond cutting centers.

A small group of people, from manufacturers to major players in the diamond industry, have championed ethical jewelry. The “Ethical Jewelry Summit” which took place at the world bank on Oct. 25th, 26, 2007, focused on the plight of small scale, artisan miners in the diamond and precious metal sectors.

Consumers can help too. If just one out of ten of those in search of a diamond engagement ring asked for a “fair trade” diamond, the process would move more quickly. A recent article in the Rapaport Magazine (9/07, published only in print) surveyed sales people in Las Vegas, NV jewelry stores. The article generated some controversy. It found that many who sell diamonds even now, know very little about the conflict diamond issue. These sales people must be besieged by an army of educated consumers who demand ethical diamond sourcing.

The jewelry business, like most every other business, has always shown itself to be more motivated by money than by ethics. However, all of those involved in ethical jewelry practices hope to move our initiatives forward with the support of people in the market who share our humanitarian concerns.