Angola's Diamond Conflict: What's At Stake?

Angola's civil war, which began in 1960 with the fight for independence from Portugal, has been fuelled by the country's diamond resources. Rebel groups, especially the National Union for the Total Independence of Angola (UNITA), have exploited diamond resources to fund their fight against the government. The United Nations has banned the sale of diamonds from Angola, but poor controls in the international diamond industry have made it difficult to prevent conflict diamonds from entering the market. The Kimberley Process Certification Scheme, launched in 2003, has been instrumental in preventing UNITA from continuing to finance its armed struggle through diamond sales. However, challenges remain, and there are concerns that Angola has become a centre for conflict diamond laundering. The complex and opaque nature of the diamond industry, as well as the involvement of powerful companies like De Beers, further complicate efforts to address the issue.

The Kimberley Process Certification Scheme

History and Establishment:

The KPCS was established in May 2000 in Kimberley, South Africa, which gave the process its name. It was created through a series of negotiations and consultations involving diamond-producing countries, the diamond industry, and non-governmental organizations (NGOs). The initiative grew out of a need to address the negative impact of conflict diamonds on the diamond trade and to ensure that diamond purchases did not fund violent conflicts.

Objective and Function:

The primary objective of the KPCS is to regulate the trade of rough diamonds and prevent the flow of conflict diamonds into the legitimate diamond market. Conflict diamonds, also known as blood diamonds, are diamonds that are used by rebel movements or rogue governments to finance wars against legitimate governments, fuel armed conflicts, and perpetrate human rights abuses. The KPCS aims to break this link between diamonds and conflict by implementing a certification system for rough diamonds.

Under the KPCS, participating countries agree to only trade with other participants who have also implemented the KPCS. This creates a controlled chain of custody for diamonds from the mine to the consumer. The scheme requires countries to set up import and export controls, ensuring that all shipments of rough diamonds are accompanied by a Kimberley Process Certificate, which guarantees that the diamonds are conflict-free. These certificates include information such as the value, origin, and intended destination of the diamonds.

Impact and Effectiveness:

The Kimberley Process has been relatively successful in reducing the trade of conflict diamonds and raising consumer awareness about the origins of their diamond purchases. It has helped to legitimize the diamond industry and restore consumer confidence in the diamond trade. As of 2023, the KPCS has 55 participants representing 82 countries, with the European Union and its member states counting as a single participant. Angola, for instance, has benefited from the KPCS, as it has been able to sell its diamonds with the guarantee that they are conflict-free, thereby attracting international buyers and boosting its economy.

However, the KPCS has also faced criticism for not being comprehensive enough and for having limited scope. For instance, some human rights organizations argue that the KPCS does not address diamonds that fund abusive and oppressive governments, even if those diamonds are not directly funding armed conflicts. There are also challenges in monitoring and enforcing the KPCS in countries with weak governance and a lack of transparency. Despite these limitations, the KPCS remains a vital initiative that has made significant progress in disrupting the trade of conflict diamonds and promoting ethical practices in the diamond industry.

The UNITA rebels

UNITA's ability to finance its war efforts is largely due to its access to and control of the country's diamond mines. Between 1992 and 1998, during the raging civil war, UNITA earned at least $3.72 billion from illicitly obtained rough diamonds, constituting about 93% of all diamond sales in Angola during that period. This illicit diamond trade allowed UNITA to buy fuel and weapons, and the group was even able to maintain a sophisticated military operation despite international sanctions.

The United Nations has attempted to curb the flow of conflict diamonds by imposing sanctions and creating a "monitoring mechanism" to investigate conflict diamond peddling. However, the effectiveness of these measures has been limited due to the difficulty in proving the origin of the stones and the lack of comprehensive legislation and enforcement in key diamond-trading countries.

The Kimberley Process Certification Scheme (KPCS), launched in 2003, has been one of the most successful initiatives in preventing UNITA from continuing to finance its armed struggle. The KPCS aims to prevent conflict diamonds from entering the market by requiring governments to certify that shipments of rough diamonds are conflict-free. This scheme has helped to maintain peace in Angola and has been a notable success story in addressing the issue of conflict diamonds.

The role of the De Beers diamond company

In the context of the Angola conflict, De Beers's role has evolved over time. Initially, De Beers was not directly involved in diamond mining in Angola. However, the company's dominance in the global diamond trade made it a key player in addressing the issue of conflict diamonds. De Beers recognized the seriousness of the situation and committed to limiting the trade of blood diamonds. They supported and complied with the Kimberley Process Certification Scheme (KPCS), which was established in 2000 to prevent the trade of conflict diamonds and ensure transparent and ethical sourcing.

In 1995, De Beers signed a series of joint venture agreements with Angola's state diamond company, Endiama, which allowed them to buy rough diamonds from local diggers. However, due to the conflict diamond crisis, De Beers later closed all its buying offices in Africa. De Beers also played a role in the development of the Angolan diamond industry by providing expertise and knowledge transfer. They were involved in the exploration and mining activities in the country, particularly in the northeast region, which is known for its diamond-rich deposits.

In 2022, De Beers signed two mineral investment contracts with the Angolan government, marking their return to the country after a ten-year absence. These contracts gave De Beers the rights to explore and mine through joint ventures with Endiama. De Beers holds a majority stake in these ventures, with Endiama having the opportunity to increase its equity share over time. This move by De Beers demonstrates their continued interest in Angola's diamond resources and their commitment to the country's diamond industry.

Overall, De Beers has had a significant role in the Angola and diamonds conflict. Their influence in the global diamond market and their involvement in Angola's diamond industry have made them a key player in addressing the issue of conflict diamonds and promoting ethical practices in the diamond trade.

The impact of the diamond trade on Angola's economy

Angola's economy is heavily dependent on its natural resources, particularly oil and diamonds. The country is the third-largest producer of diamonds in Africa and has the potential to be one of the world's top diamond producers. However, the diamond industry in Angola has been plagued by corruption, human rights violations, and diamond smuggling, which have deterred foreign investment.

During the civil war, the diamond mines were constantly fought over, and the frequent change in control made it unsafe for miners to work. Despite the challenges, both sides were able to extract diamonds and use the revenue to fund their war efforts. The diamond industry also suffered from attacks on mining centers, disruptions to transport routes, and widespread theft and smuggling, which caused diamond sales to decline.

Since the end of the civil war, Angola has made efforts to attract foreign investment and develop its diamond industry. The government has implemented policies to improve the investment environment, and the country has the potential to meet the global demand for diamonds due to the discovery of new deposits.

The diamond industry in Angola has the potential to bring significant economic growth and development. However, it is essential to address the issues of corruption, human rights violations, and diamond smuggling to ensure that the industry benefits the country and its people.

Angola's diamond industry has seen success, with companies like Catoca Mining Society contributing significantly to the country's diamond production and turnover. The company has invested in expanding its operations and improving its energy infrastructure. Additionally, the global demand for diamonds and the discovery of new deposits in Angola present opportunities for investors.

The international community's response

One of the key responses has been the introduction of sanctions against UNITA, the rebel movement in Angola. The United Nations Security Council passed Resolution 1173 in June 1998, which included a ban on the import of diamonds not controlled through a certificate of origin scheme or recognised by the Angolan government. This resolution aimed to prevent UNITA from using diamond sales to finance its armed struggle against the government.

Another significant response has been the establishment of the Kimberley Process Certification Scheme (KPCS). The KPCS was launched in 2003, soon after the end of Angola's civil war, to prevent the military wing of UNITA from continuing to finance its operations through diamond sales. The KPCS is a global certification system that requires participating countries to certify that their diamond exports are conflict-free. This system has helped to increase transparency and accountability in the diamond industry and has been instrumental in reducing the trade of conflict diamonds.

In addition to the KPCS, there have been efforts to develop more comprehensive solutions to the problem of conflict diamonds. For example, Global Witness, a non-governmental organisation, has put forward a range of recommendations, including the introduction of a global diamond certification and verification system monitored by an independent organisation, industry self-regulation, and government legislation. These recommendations aim to address the lack of sufficient controls in the diamond industry and prevent diamonds from being used to fund conflicts.

The international community has also recognised the need for greater collaboration and information sharing to address the issue of conflict diamonds effectively. This includes working with diamond-producing countries, such as Angola, to improve import and export controls and ensure the verifiable declaration of a rough diamond's country of extraction.

Overall, the international community's response to the Angola and diamonds conflict has involved a combination of sanctions, certification schemes, and collaborative efforts to increase transparency and address the structural factors that enable the trade of conflict diamonds. These responses have contributed to the gradual weakening of UNITA and the establishment of peace in Angola.

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