Topic Page: Blood Diamond

Topic Page: Blood Diamond

Definition: blood diamond from The Macquarie Dictionary

1.
a rough diamond that is sourced by unscrupulous or illicit means in an area where there is military conflict,
the sale of which is then used to perpetuate the conflict, as a diamond mined in an area of Africa
controlled by forces or factions opposed to the recognised government and used to fund military action in
opposition to that government.

Plural: blood diamonds

Etymology: from the notion that the diamond is tainted by the blood of people who have died in the
conflict

                              Summary Article: Blood Diamonds
                              From The SAGE Encyclopedia of Economics and Society

                           Diamonds, a luxury good, have a romantic image in the West. Diamonds are
                           associated with engagement rings symbolizing love and have an image of
  Image from:              elegance and timeless treasure. Such images, along with an oligarchic market
  Zimbabwe in Philip's where artificial scarcity is generated through tight control over the influx of
  Encyclopedia             diamonds into the market, help generate huge profits. However, blood
                           diamonds’ image of war and brutality goes against the grain of such an
  aesthetic portrayal. The Kimberly Process Certification Scheme (KPCS) has sought to regulate the
  trade in blood diamonds.

  The term blood diamond specifically refers to diamonds that are extracted and exported from
  particular regions in sub-Saharan Africa that are still ravaged by vicious and armed conflicts. These
  diamonds are alluvial diamonds, found very close to the surface of the earth, spread over hundreds of
  square miles, and are hence easy to extract. They are a currency of transaction during brutal civil wars
  and armed conflicts. The conflicts instigated by renegade militias, intransigent warlords, and rebel
  groups thrive on the illegal sale of blood diamonds in exchange for military weapons and assorted war
  materials such as land mines, guns, fuel, food, and medicines. The sale is easy because diamonds are
  relatively small, not easily detectable, portable, and fungible—and a small amount commands millions of
  dollars. Once smuggled out of a conflict zone, it is very difficult to establish the origin of blood
  diamonds, and the diamonds then can be laundered easily. There is, hence, a constant struggle for
  territories of blood diamonds and the financial revenues generated from the sale of these gemstones.
  According to one estimate, the black market economy of blood diamonds represents 10 to 15 percent
  of the world's $6.8 billion annual diamond production. Africa thus suffers from a “resource curse.”

  Many African countries endowed with diamonds suffer from chronic regional and internal political
  instability and intensification of border states hostilities, with cross-border military incursions occurring
  on the grounds of ethnicity, communal schisms, regionalism, and religious differences. State-sponsored
  support for renegade rebel militias has enabled the extraction and economic profiteering from the sale
  of blood diamonds. For example, Rwanda, Uganda, and Burundi militarily supported the rebel Congolese

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Rally for Democracy and Congolese Liberation Movement to oust President Laurent Kabila of the
  Democratic Republic of Congo from power. Colluding countries like Zambia, Côte d'Ivoire, and others
  have provided false end-user certificates to disguise their arms shipments to rebels in other countries
  in exchange for blood diamonds.

  The regional instabilities arising from the privatization of security have unleashed major humanitarian
  crises in the form of egregious human rights violations, particularly rape and mutilation of women,
  recruitment of child soldiers, and child sexual slavery, resulting in the generation of millions of refugees
  fleeing from such conflicts. There is rampant poverty, and peasant miners are forced to sell diamonds
  to the rebels. The continent is also plagued by the scourge of HIV/AIDS (human immunodeficiency
  virus/acquired immune deficiency syndrome).

  Three major troubled states are Angola, Democratic Republic of Congo (DRC), and Sierra Leone. They
  are involved in the regional conflict over blood diamonds. All of these countries were on opposite sides
  of the Cold War between the United States and the former Soviet Union. For example, in Angola, the
  National Union for the Total Independence of Angola (UNITA) rebel movement was backed by the
  Soviet Union, while the Angolan government was backed by the United States. During this period,
  UNITA had total control over the diamond mines. Since it received funding from the Soviet Union, it
  stockpiled diamonds for later sale. After the Cold War, resources from the Soviet Union dried up. In
  Angola, the UNITA rebel movement and its leader Jonas Savimbi violated the United Nations (UN)
  Security Council sanctions and embargoes against clandestine gun trafficking and the illegal sale of
  blood diamonds. During the period from 1992 to 1998, UNITA raised between US$3 billion and US$4
  billion from illegal diamond sales through covert trading networks of brokers and middlemen and transit
  shipment facilities. Such covert networks included even major diamond trading cities such as Antwerp in
  Belgium, where dealers turned a blind eye to conflict diamonds. Since 2002, UNITA has entered into a
  cease-fire with the government.

  Sierra Leone has the most prosperous gemstone mines. During the mid- to late 1990s Revolutionary
  United Front (RUF) rebels sold between US$25 million and US$125 million in rough diamonds each year
  to fuel their insurgency. The leaders of Burkina Faso and Liberia's leader Charles Taylor together with
  Foday Sankoh of the RUF in Sierra Leone formed a diamond-smuggling cartel. Liberia thus became a
  major center for huge pan-African diamond-related criminal activity such as guns, drugs, and money
  laundering. Because of the atrocious crimes committed by the RUF, the issue of blood diamonds came
  to the forefront of international attention. At the end of 1998, the London-based nongovernmental
  organization (NGO) Global Witness issued a vivid account of atrocities such as chopping off the hands
  or forearms of tribal villagers who resisted the authority of the RUF. In response, the UN Security
  Council imposed sanctions and a weapons embargo on Sierra Leone and was successful in disarming
  the RUF.

  The DRC experiences what is called “Africa's World War” because of the involvement of troops from
  seven African nations: Zimbabwe, Chad, Namibia, Angola, Uganda, Burundi, and Rwanda. This war has led
  to the death of 2.5 million people in just 4 years. The conflict continues to this day because of poor
  governance. The DRC smuggles from US$50 million to US$60 million in rough diamonds every year.
  DRC's recognized diamond sector constitutes only 25 percent of the overall mining sector.

  Added to the conflicts in the aforementioned African countries has been the rise of terrorist networks
  that also seek to leverage blood diamonds. Dealers associated directly with key operatives in the al-

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Qaeda network have been known to purchase diamonds from rebels in Sierra Leone and sell them in
  Europe. After the September 11, 2001, attacks on the United States, the terrorists sought to safeguard
  their finances by buying gems that can be easily hidden, hold their value, and remain virtually untraceable.

  Post–Cold War, in 2000, Angola and the DRC established exporting monopolies to reduce the
  smuggling of blood diamonds and increase the official state revenue. However, such monopolies turned
  out to be sham, a facade for garnering cash for the war effort. In effect, as the monopoly created price
  distortions, other producers resorted to more smuggling. Like these countries, Zimbabwe established
  joint ventures after it discovered the Marange diamonds. However, with the consent and assistance of
  certain Zimbabwe African National Union (Patriotic Front) politicians, members of the security agencies,
  such as the army, air force, and police, became key beneficiaries of looting the Marange fields. These
  agents established exploitative mining syndicates, smuggled diamonds through nearby Mozambique, and
  even allegedly secured a diamonds-for-arms deal with the People's Liberation Army of China. In the
  process, the agents committed many human rights violations.

  The diamond trade if made legal and legitimate would enable Africa to build its infrastructure, establish
  long-standing governments, and enable these governments to be in control of their nations’ natural
  resources, thereby ending their financial dependence on Western aid. In response to such a need, the
  KPCS for conflict-free diamonds, as a self-regulative measure, was introduced in 2003. The multilateral
  institution was created as an effort to counteract the negative international publicity generated by the
  growing public awareness, consumer backlash, and pressure from international NGOs such as Global
  Witness, Medico International, the Netherlands Institute for South Africa, and Oxfam. It has been
  supported by 83 other diamond-importing and -exporting countries. Diplomatic heavyweights such as
  the United States, China, Russia, India, Brazil, Japan, and the European Union are all part of the KPCS.
  National legislation of the member states and the “soft law” of the UN General Assembly resolutions
  and UN Security Council sanctions and directives drive the KPCS process. Beyond countries, the KPCS
  includes industry participants like DeBeers and Rio Tinto, as well as NGOs like the Ottawa-based
  Partnership Africa Canada. Therefore, the KPCS has managed to bring together states, corporate
  entities, and civil society with capabilities in technical issues and the politics of diplomacy to resolve a
  major problem of global governance.

  The intention of the KPCS is to ensure that parcels of rough diamonds can be tracked from their
  primary source of origin (i.e., where they are extracted) without confusing specific parcels with the
  country of provenance or the country from which a particular parcel of diamonds in the transaction chain
  comes. The scheme certifies only diamonds harvested from legal, government-run mines. The hope is
  that this will prevent rogue regimes and rebels from flooding the international market with blood
  diamonds. The KPCS drafters believed that if given the choice, consumers would be socially
  responsible and prefer to buy diamonds mined legally, with profits flowing to legitimate sources of
  power.

  In the KPCS, countermeasures against blood diamonds include counterfeit-proof documentation, the
  use of tamper-proof containers, and a database of the shipments of rough stones from the areas of
  primary extraction. Also, leading international diamond organizations such as the World Federation of
  Diamond Bourses, World Diamond Council, Jewelers of America, and Diamond High Council of
  Certification have promised the expulsion of deviant diamond traders from the industry. Nonetheless,
  the success of the certification scheme depends on effective monitoring and enforcement.

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The major problem of the KPCS is its voluntary nature. There are no international watchdogs and
  universal guidelines. This invites abuse and inefficiency, particularly in countries that lack the resources
  for capacity building. Credibility depends on all participants establishing proper authorities and internal
  systems of control that would prevent blood diamonds from entering the chain of production, export,
  and import of rough diamonds within their territories. Also, nonsignatories to the KPCS can undermine
  its integrity by demonstrating a lack of political will and becoming corridors for smuggling diamonds from
  the mines to the consumer nations. A key shortcoming in the KPCS is its focus only on rough diamonds
  and its overlooking of polished diamonds already included in jewelry. Thus, blood diamonds can be
  transformed into polished stones, embedded within jewelry, and then imported so as to go virtually
  undetected. Without a ban on trade with nonparticipants via the World Trade Organization (WTO), the
  KPCS process becomes weakened. There is need for effective monitoring of the pipeline of
  diamonds from beginning to end.

  The KPCS allows for regular meeting of participants and observers. Decision making on compliance and
  dispute prevention depends on the participants reaching a consensus. In the absence of a consensus,
  the chair conducts consultations. Such a method of dispute resolution is vague and has inarticulate
  direction. For example, the KPCS talks about proportional penalties for transgressions but never
  articulates how to ascertain the proportionality of the transgression or what the penalties should be.
  Similarly, the issue of consultations conducted by the chair is vague. There is no clear articulation of
  what these consultations should entail, how impartiality would be ensured, and the time frame needed
  to conclude the consultation. Therefore, the KPCS leaves open the possibility of confusion and
  prohibitive interpretation.

  The KPCS is hard to implement without proper funding and clearer guidelines. But efforts have been
  made. In 2004, the Republic of Congo was found to be improperly issuing certificates for more than 5
  million carats of rough diamonds. Therefore it was removed from the list of countries participating in
  the KPCS. In 2003, the Central African Republic was suspended because rebels had captured diamond
  mining areas. In 2004, Lebanon was suspended for failing to pass new domestic laws that provided for
  better oversight of the import and export of rough diamonds. The countries were reinstated only after
  they met the minimum requirements of the KPCS.

  Nonetheless, in 2006, Côte d'Ivoire complained that conflict diamonds had been sold in the
  international market without any sanctions against those involved in the trade. In 2010, KPCS members
  could not come to a consensus over certifying Zimbabwe's diamonds. This was because the mines are
  controlled by the government rather than rebels. But there have been significant human rights violations
  by the government, and hence, critics contend that the government needs to be sanctioned. Despite
  that, in August 2010, approval was given for a limited sale of diamonds worth US$72 million after the
  monitor, a South African diamond expert, declared the diamonds to be “clean.” The situation remains
  tenuous as Zimbabwe has not been sanctioned out of fear that it would become a major hub for the
  trafficking of illicit diamonds.

  If the KPCS uses the WTO's dispute resolution methods, which have significant teeth to them, it might
  be more effective. Moreover, the WTO's methods of dispute resolution are quick and efficient. If such
  dispute resolution methods were coupled with widespread media coverage on the harvesting of blood
  diamonds to educate consumers, the situation might improve significantly.

  S e e a ls o Corporate Social Responsibility; Fair Trade Movement; Human Rights Networks

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Further Readings

     Grant, Andrew J. “Consensus Dynamics and Global Governance Frameworks: Insights From the
  Kimberly Process on Conflict Diamonds.” Canadian Foreign Policy Journal, v.19/3 (2013).
     Grant, Andrew J.; Ian Taylor. “Global Governance and Conflict Diamonds: The Kimberly Process and
  the Quest for Clean Gems.” The Round Table: The Commonwealth Journal of International Affairs,
  v.93/375 (2004).
     Murphy, Shannon K. “Clouded Diamonds: Without Bending Arbitration and More Sophisticated
  Dispute Resolution Mechanisms, the Kimberly Process Will Ultimately Fail in Ending Conflicts Fueled by
  Blood Diamonds.” Pepperdine Dispute Resolution Law Journal, v.11/2 (2011).
     Orogun, Paul. “‘Blood Diamonds’ and Africa's Armed Conflicts in the Post-Cold War Era.” World
  Affairs, v.166/3 (2004).

                                                                                              Pallab Paul
                                                                                   Kausiki Mukhopadhyay

     APA

     Chicago

     Harvard

     MLA

  Paul, P., & Mukhopadhyay, K. (2015). Blood diamonds. In F. F. Wherry, & J. Schor (Eds.), The SAGE
     encyclopedia of economics and society. Thousand Oaks, CA: Sage Publications. Retrieved from
     https://search.credoreference.com/content/topic/blood_diamond

                 Copyright © 2015 by SAGE Publications, Inc.

               Copyright © 2015 by SAGE Publications, Inc.

https://search.credoreference.com/content/topic/blood_diamond

APA
Paul, P., & Mukhopadhyay, K. (2015). Blood diamonds. In F. F. Wherry, & J. Schor (Eds.), The SAGE
encyclopedia of economics and society. Thousand Oaks, CA: Sage Publications. Retrieved from
https://search.credoreference.com/content/topic/blood_diamond

Chicago
Paul, Pallab, and Kausiki Mukhopadhyay. "Blood Diamonds." In The SAGE Encyclopedia of Economics and
Society, edited by Frederick F. Wherry, and Juliet Schor. Sage Publications, 2015.
https://search.credoreference.com/content/topic/blood_diamond

Harvard
Paul, P. and Mukhopadhyay, K. (2015). Blood diamonds. In F.F. Wherry & J. Schor (Eds.), The SAGE
encyclopedia of economics and society. [Online]. Thousand Oaks: Sage Publications. Available from:
https://search.credoreference.com/content/topic/blood_diamond [Accessed 21 July 2019].

MLA
Paul, Pallab, and Kausiki Mukhopadhyay. "Blood Diamonds." The SAGE Encyclopedia of Economics and
Society, edited by Frederick F. Wherry, and Juliet Schor, Sage Publications, 1st edition, 2015. Credo
Reference, https://search.credoreference.com/content/topic/blood_diamond. Accessed 21 Jul. 2019.

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