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Read moreThe Kimberley Process in the Spotlight: Beyond the Surface
Understanding the International Regulation of the Diamonds Industry and its Potential Influence on Global Extractive Industries
- The Birth of the Kimberley Process in the Diamond Industry
- The Role and Function of the Kimberley Process
- Non-Participating Diamond-Producing Nations in the Kimberley Process
- Governance and Leadership of the Kimberley Process
- Financing the Kimberley Process
- Criticisms Over the Kimberley Process: Key Points
- The Impact of Broader Collaboration in Extractive Industries
- How Individuals Can Contribute to Positive Change in Extractive Industries
The diamond industry has always been shrouded in an aura of allure and mystique, but beneath its glittering surface lie complex and pressing issues that most extractive industries are faced with. The Kimberley Process (KP), an international initiative launched in 2003, has sought to address some of these challenges, specifically the trade in conflict diamonds.
This article explores the origins, workings, and implications of the KP, along with its triumphs and criticisms. It also delves into the broader context of the global extractive industry, emphasizing the need for similar regulatory measures in other sectors, such as the mining of tin, tantalum, tungsten, and gold.
The Birth of the Kimberley Process in the Diamond Industry
The Kimberley Process came into existence in response to the mounting international pressure to address the issue of conflict diamonds, also known as blood diamonds. These are diamonds mined in war zones and sold to finance armed conflict against governments.
In the late 1990s and early 2000s, the world’s attention was captured by the devastating civil wars in countries like Sierra Leone, Angola, and the Democratic Republic of Congo. It became increasingly clear that the trade in diamonds was fueling these conflicts.
In response to this, the global community came together in a unique collaboration between governments, the diamond industry, and non-governmental organizations (NGOs). The Kimberley Process Certification Scheme (KPCS) was initiated in May 2000 when southern African diamond-producing states met in Kimberley, South Africa, to discuss ways to stop the trade in conflict diamonds and ensure that diamond purchases were not financing violence.
This meeting led to a series of negotiations that lasted for nearly two years, resulting in the formal adoption of the Kimberley Process Certification Scheme in November 2002. The KPCS imposes extensive requirements on its members to enable them to certify shipments of rough diamonds as ‘conflict-free’. Today, the Kimberley Process has 82 participating countries, representing most of the nations involved in the diamond trade.
It’s critical to understand that the establishment of the Kimberley Process was a testament to the power of global cooperation in addressing complex and deeply rooted issues. It represents a significant step towards ethical diamond trading and a commitment to peace and human rights.
The Role and Function of the Kimberley Process
The Kimberley Process Certification Scheme (KPCS) is a global endeavor that aims to stem the flow of conflict diamonds – rough diamonds used by rebel movements to finance wars against legitimate governments. But what does the Kimberley Process do in practical terms?
At its core, the Kimberley Process sets requirements for its members to control all imports and exports of rough diamonds. Every diamond exported must be accompanied by a Kimberley Process certificate guaranteeing that it is conflict-free.
Here are some of the key roles and functions of the Kimberley Process:
Certification of Rough Diamonds
The Kimberley Process ensures that each shipment of rough diamonds crossing an international border is transported in a tamper-resistant container and accompanied by a government-validated Kimberley Process Certificate. Each certificate is unique and contains data allowing for the traceability of the rough diamonds. This certification provides assurance that the diamonds are conflict-free.
Trade Control
The Kimberley Process allows participants to only trade rough diamonds with other participants who have also met the scheme’s minimum requirements. This control system encourages countries to comply with the Kimberley Process’s requirements to access the international diamond market.
Transparency and Reporting
The Kimberley Process promotes transparency in the diamond industry through the exchange of statistical data. Participants are required to provide annual reports on their implementation of the scheme.
Peer Review
The Kimberley Process includes a peer review system to ensure participants are effectively implementing the scheme. Review missions assess whether participants are complying with the Kimberley Process’s requirements.
Collaboration with Industry and Civil Society
The Kimberley Process involves a tripartite system where governments, industry, and civil society all have a role. The World Diamond Council represents the industry, and non-governmental organizations (NGOs) represent civil society. This collaboration ensures that all stakeholders have a voice in the Kimberley Process.
The Kimberley Process, therefore, serves as a crucial mechanism for regulating the global trade of rough diamonds. It strives to maintain peace and ethical practices within the diamond industry. It also protects the industry’s legitimacy and the livelihoods of those who depend on it.
Non-Participating Diamond-Producing Nations in the Kimberley Process
The Kimberley Process Certification Scheme (KPCS) plays a critical role in regulating the global diamond trade. However, it’s also important to understand the complexities of participation in this scheme. Some diamond-producing countries have faced difficulties or have voluntarily chosen not to participate in the KPCS.
The Republic of Congo
The Republic of Congo offers a case study in the consequences of non-compliance. In 2004, the nation was removed from the Kimberley Process. Indeed it was unable to verify the origins of its diamonds, suspected to be sourced from the Democratic Republic of the Congo. This suspension had significant implications, given the global reach of the Kimberley Process. However, by 2007, the Republic of Congo managed to reinstate its Kimberley Process membership. This truly illustrated the potential for nations to rectify their shortcomings and rejoin the international diamond community.
Côte d’Ivoire
Another intriguing case is Côte d’Ivoire, where diamond trading was outright prohibited in 2005. The nation’s diamonds were labeled as conflict resources, leading to a ban that reflects the Kimberley Process’s commitment to ethical diamond trade.
Venezuela
Venezuela represents a unique scenario where a nation voluntarily withdrew from the Kimberley Process. After several years of non-compliance and limited communication with Kimberley working groups, Venezuela chose to exit the KPCS in 2008, deciding instead to focus on strengthening its own infrastructure.
Interestingly, both Côte d’Ivoire and Venezuela are considered Kimberley Process members, but not participants. This nuanced distinction is due to their failure to meet the minimum requirements of the Kimberley Process Certification Scheme. While they maintain their membership, their status prevents them from trading rough diamonds with other participants.
This examination of non-participating nations underscores the rigorous standards of the Kimberley Process and the global commitment to ethical diamond trade. It highlights the importance of transparency, regulation, and global cooperation in maintaining the integrity of the diamond industry.
Governance and Leadership of the Kimberley Process
The governance of the Kimberley Process Certification Scheme (KPCS) is structured in a unique way to accommodate the global scale of the diamond industry and the diverse stakeholders involved. The system is designed to encourage cooperation, accountability, and shared responsibility. Here’s how it works:
Plenary Meetings
The highest decision-making body of the Kimberley Process is the Plenary, which meets annually. Representatives from all participating countries, as well as observers from the diamond industry and civil society, attend these meetings. The Plenary reviews progress made over the past year, discusses challenges, and plans for the future. It is at these meetings where significant decisions regarding the Kimberley Process are made.
Working Groups and Committees
The Kimberley Process has several working groups and committees that focus on specific areas, such as monitoring, statistics, and diamond experts. These groups play a critical role in the day-to-day functioning of the Kimberley Process, conducting reviews, compiling statistical data, and providing technical advice.
The Kimberley Process Chair
The Kimberley Process is led by a Chair, chosen by the Plenary. The Chair is a representative from one of the participating countries, and the position rotates annually. The Chair is responsible for leading and representing the Kimberley Process throughout the year. The Chair also organizes the Plenary meeting, and manages the work of the Kimberley Process’s various bodies.
The Kimberley Process Vice-Chair
The Vice-Chair, also chosen by the Plenary, assists the Chair and prepares to take over the Chair position the following year. This ensures a smooth transition of leadership.
Participation of Industry and Civil Society
The diamond industry, represented by the World Diamond Council, and civil society organizations are official KP observers. They participate in the Plenary and working groups, contributing their expertise and perspectives. This tripartite system ensures that all relevant stakeholders are involved in the governance of the Kimberley Process.
Through this collaborative and rotational leadership structure, the Kimberley Process ensures that the responsibility of overseeing the global diamond trade is shared among all participants. It allows the Kimberley Process to adapt to changing circumstances. it also allows it to continually improve its effectiveness and maintain its commitment to preventing the trade in conflict diamonds.
Financing the Kimberley Process
The Kimberley Process Certification Scheme (KPCS) operates on a global scale, with participants from over 80 countries. To support its operation, the Kimberley Process relies on a combination of contributions from participating countries and support from other stakeholders.
Contributions from the Kimberley Process Participants
Each participant country contributes to the financing of the Kimberley Process. The amount each country contributes is based on a formula that takes into account the country’s economic strength and its level of involvement in the diamond industry.
Hosting of Meetings
The annual Plenary meeting and other meetings of the Kimberley Process’s working groups and committees are typically hosted by the participant that holds the Chair for that year. The hosting country is responsible for covering the costs of organizing and running these meetings.
In-Kind Contributions
Participants and observers also provide in-kind contributions, such as the time and expertise of their representatives who participate in the Kimberley Process’s meetings and activities.
Support from Industry and Civil Society
The diamond industry, represented by the World Diamond Council, and civil society organizations also contribute to the Kimberley Process, both financially and in terms of expertise and resources.
These sources of financing ensure that the Kimberley Process is able to effectively regulate the global diamond trade. It’s a system that requires active participation and shared responsibility from all involved.
Criticisms Over the Kimberley Process: Key Points
Evasion of the System
Critics argue that some diamonds manage to evade the Kimberley Process, undermining its effectiveness. Diamonds have fueled decades of conflicts in countries like Angola, Ivory Coast, Sierra Leone, and the Democratic Republic of the Congo. Global Witness reports suggest that much of this is still happening in parts of Africa.
Human Rights Abuses
There are accusations of serious human rights abuses in diamond mines, particularly in Zimbabwe. The military and political elite have been accused of exploiting the country’s diamond wealth, often through force. Reports include allegations of the military forcing children and women to work in mines, torturing and beating local villagers, and illegally panning diamonds for export through undesignated points.
Illegal Smuggling and Mixing of Diamonds
Despite the KP’s efforts, illegal smuggling of diamonds continues, especially from Zimbabwe to Mozambique and South Africa. These diamonds often end up mixed with diamonds from legitimate sources and sold to western buyers. This issue undermines the KP’s goal of ensuring that all diamonds are conflict-free.
Lack of Transparency and Accountability
The Congolese government, for example, reportedly has no knowledge of where 40% of its diamonds come from. This raises questions about the effectiveness of the KP’s requirement for an audit trail for every diamond.
Structural Limitations of the Kimberley Process
Decisions within the KP need to be agreed upon by all participating governments. If a member doesn’t agree with a proposed action, the process can’t move forward. This structural limitation can hinder the KP’s ability to effectively address issues and enforce regulations.
Lack of Enforcement
Some critics argue that the KP’s impact could be stronger if major diamond consumers, like the United States, enforced stricter importation rules for countries unable to meet KP’s minimum provisions.
Limited Scope
The KP was established primarily to prevent the trade of conflict diamonds that fund rebel movements against recognized governments. It does not address other serious issues like environmental damage, child labor, or the rights of artisanal miners. This limited scope has been a point of criticism as well.
It’s worth noting that while the KP has faced these criticisms, it has also been credited with significantly reducing the global supply of conflict diamonds. However, the criticisms highlight areas where improvements can be made to better achieve its goals.
The Impact of Broader Collaboration in Extractive Industries
The Kimberley Process (KP) has made significant strides in regulating the diamond industry. It’s important to acknowledge that diamonds represent just a fraction of the global extractive industry. Many of the issues that the KP aims to address, such as conflict financing, human rights abuses, and lack of transparency, are not limited to diamonds but are prevalent in the extraction and trade of many other natural resources.
Consider the extraction of minerals like tin, tantalum, tungsten, and gold, which are essential components in every smartphone and many other electronic devices. Like diamonds, these minerals are often sourced from countries with a history of conflict and poor regulation. They are, thus, susceptible to similar issues that the KP seeks to address in the diamond industry.
The impact of the KP could potentially be amplified if similar principles and standards were applied across other extractive industries. This would involve collaboration not only between the industries themselves but also between producing countries. By working together to improve transparency, enforce human rights standards, and ensure that profits from natural resources do not fund conflict, these industries could collectively have a more significant positive impact.
Broadening the scope of initiatives like the KP could also help address criticisms about its limited scope. For instance, a more comprehensive approach could better address environmental damage, child labor, and the rights of artisanal miners, issues that are prevalent across many extractive industries.
In conclusion, while the KP has made notable progress in regulating the diamond industry, its principles could serve as a blueprint for wider reform. If applied to other extractive industries, such a collaborative and comprehensive approach could lead to significant improvements in human rights, environmental stewardship, and conflict resolution worldwide.
How Individuals Can Contribute to Positive Change in Extractive Industries
While the responsibility for improving extractive industries largely falls on governments, corporations, and international organizations, individuals also play a crucial role in driving positive change. Here are some ways you can contribute to making extractive industries more sustainable and ethical:
Make Informed Purchases
Research the origins of the products you buy, especially when it comes to diamonds, gold, and electronics. Many companies now provide information about their supply chains, and certifications such as the Kimberley Process for diamonds can help you ensure your purchases are not supporting conflict or human rights abuses. Opt for brands that prioritize ethical sourcing and transparency.
Support Responsible Brands
Buy from companies that have robust policies on human rights, labor practices, and environmental protection. These companies often have third-party certifications that verify their practices.
Advocate for Legislation
Support policies and regulations that promote transparency, human rights, and environmental protection in extractive industries. This could involve signing petitions, writing to your local representatives, or participating in public consultations.
Raise Awareness
Use your voice to inform others about the issues associated with extractive industries. This could be through social media, conversations with friends and family, or hosting educational events.
Invest Responsibly
If you invest in stocks or funds, consider the practices of the companies you’re investing in. Many investment firms now offer socially responsible investing options that exclude companies with poor environmental, social, and governance practices.
Support Non-Profits and NGOs
Many non-profit organizations work to improve conditions in extractive industries. Consider donating to these organizations or supporting their advocacy efforts. There are several NGOs involved in the Kimberley Process, amongst which Global Witness and Partnership Africa Canada (PAC).
Remember, every action, no matter how small, can contribute to a larger movement for change. By making informed decisions and using our voices, we can all play a part in promoting a more ethical and sustainable extractive industry.