13 February 2002

Congress Told U.S. Is Active Supporter of Kimberley Process

Washington -- The U.S. government is an active backer of the Kimberley Process, which seeks to stop the international trade in diamonds used to fund bloody conflicts, mainly in Africa, says State Department official Alan Eastham.

Eastham told the Senate Subcommittee on Oversight of Government Management, looking into the "conflict diamond" trade at a February 13 public hearing, "The natural wealth represented by diamonds should be a source of funds for development and human welfare.

"In many countries it is," the official said. "But, in too many cases, the money produced by diamond sales provides the funding for rebel movements to purchase arms illicitly and to support rebel armies, prolonging civil wars that have terrorized societies and destroyed communities."

As an example, he cited Sierra Leone, where "diamonds have helped transform a band of about 400 rebels of the RUF [Revolutionary United Front] into an army of thousands" that provoked and fought a civil war in which 50,000 people were killed, with more than one million others displaced from their homes and made refugees in neighboring countries.

To eliminate diamonds as a fuel for such actions, the U.S. government, Eastham explained, "has participated actively in the Kimberley Process, which adds the expertise of industry and non-governmental organizations [NGOs]" to the battle to keep diamonds out of the hands of rebels and terrorists.

The Kimberley Process is a multinational effort that aims to establish a global system of certification for all rough diamonds in order to eliminate conflict diamonds from international trade. Representatives of key diamond producing, trading, and consuming countries initiated it in Kimberley, South Africa, in May 2000, Eastham told the lawmakers.

The official said U.S. government representatives are actively participating in all of the four working groups that were set up at a meeting of the 35 Kimberley Process nations in Botswana in November 2001. The next general meeting of the Kimberley nations will be in Ottawa on March 18, when the working groups will make their reports on how to fully implement the process.

The Senate hearing was held the same day the U.S. Government Accounting Office (GAO) released a report entitled "International Trade: Significant Challenges Remain in Deterring Trade in Conflict Diamonds." Loren Yager, GAO's director of international affairs and trade, told the senators the report reached a number of conclusions, including the following:

• the diamond industry "lacks transparency, which limits information about diamond transactions;

• "U.S. controls over diamond imports generally do not require certification from the country of extraction -- just from the country of last import -- and thus are not very effective in identifying diamonds from conflict sources"; and

• while the Kimberley Process "incorporated some elements of accountability ... the scheme is not based on a risk assessment, and some activities experts deem high-risk are subject only to 'recommended controls.'"

Yager concluded in the GAO assessment that "these and other shortcomings provide significant challenges in creating an effective scheme to deter trade in conflict diamonds."

Former U.S. Ambassador to Sierra Leone Joseph Melrose told the Senate hearing that conflict diamonds might also have had a connection with the international terrorist network al Qaeda, which the U.S. government holds responsible for the September 11 terrorist attacks in New York and on the Pentagon that killed some 3,000 people, many from foreign nations.

Noting that Washington Post reporter Douglas Farah has written that "terrorists have used illicit diamonds as a means to transfer resources from one location to another," Melrose said it was not surprising that the writer would further make the assertion that RUF "sold stones to individuals identified by the U.S. government as al Qaeda operatives."

Melrose added, "Lebanese have long been involved in the Sierra Leone diamond trade," and sales similar to those allegedly done by RUF, he said, "have almost certainly taken place with other designated terrorist organizations such as the Hizbollah. In the case of Hizbollah, a connection has existed for years through various Lebanese groups."

In his recent State of the Union speech, President Bush mentioned Hizbollah when he said it and other terrorist groups such as Islamic Jihad and Jaish-I-Mohammed "operate in remote jungles and deserts, and hide in the centers of large cities."

Melrose told the Senate panel, "Information I received last week indicates that a large amount of diamonds, that were at least in part mined by RUF during the conflict, have made their way to Guinea for sale in order to raise funds for use by the RUF in the upcoming elections" in Sierra Leone.

Furthermore, he added, "despite a U.N. embargo, members of the diamond trade in Europe tell me that stones are still arriving in Europe from Liberia," Sierra Leone's neighbor, whose president, Charles Taylor, has been reported to be an active supporter of RUF and its operations in Sierra Leone.

On the Kimberley Process, Melrose said it "is not a perfect solution," but "despite its flaws, it deserves to be supported." He added: "The United States, as the biggest market for gem-quality stones, must take a leading role in ending the conditions that permit these violations of our moral and ethical standards. The legitimate diamond industry, as well as the other participants in the Kimberley Process, should continue to be consulted in this process."