Conflict Diamonds & The Kimberley Process
"Conflict Diamonds" means rough diamonds used by rebel movements or their allies to finance conflict aimed at undermining legitimate governments. - Kimberley Process Certification Scheme (KPCS)
Each year around US$12 billion of rough diamonds, mined from around the globe, are cut, polished and sold in a retail market worth nearly US$70 billion. The flow of transactions taking the diamonds from mine to market is known as 'the diamond industry pipeline'.
Australia is one of the world's largest producers of rough diamonds and is responsible for a large number of the diamonds sold into the pipeline each year. In 2006-07, Australia's exports of rough diamonds were $565 million.
During the 1990s, it became apparent that the industry pipeline was contaminated by diamonds - known as 'conflict diamonds' or 'blood diamonds' - that had been sold to finance African rebel movements. In response, the United Nations-backed Kimberley Process Certification Scheme was established to act as a worldwide certification scheme for rough diamonds.
The diamond trade affects the livelihoods of millions throughout the world. Unfortunately, a number of rebel movements in Africa exploited the nature of the diamond trade to finance their wars against legitimate governments and great hardship and misfortune was brought upon some of Africa's diamond-rich, but undeveloped, countries. The term 'conflict diamond' was popularised to describe the rough diamonds used to finance rebel groups. Angola, Sierra Leone, Liberia, Cote d'Ivoire (Ivory Coast) and the Democratic Republic of the Congo were all hurt by conflict diamonds.
The United Nations responded by placing embargoes on diamond exports from Angola, Sierra Leone and Liberia. Sanctions were introduced to stop countries accepting rough diamond imports from these countries that were not accompanied by a certificate confirming that the diamonds were mined legitimately and the proceeds from the sale were not being used to finance rebel activities. However, this export certification scheme was unsuccessful, as diamonds were being smuggled to neighbouring countries before being shipped to their destination.
While it was clear a certification scheme that applied to only a few countries could not work, it was thought that a scheme covering all diamond importing, exporting and producing countries could prove effective. This proposal, first aired in Kimberley, South Africa, gave rise to the Kimberley Process Certification Scheme - a joint initiative of governments, civil society and the diamond industry. The KPCS asked rough diamond exporters to attach a Kimberley Process certificate to their export shipments which would be verified by the importing countries' authorities when received.
The KPCS was endorsed by the UN General Assembly (UNGA), which in 2000 declared its support for 'the implementation of the certification scheme as soon as possible, recognising the urgency of the situation from a humanitarian and security standpoint.' The KPCS was also supported by the UN Security Council (UNSC) through UNSC Resolution 1459 (2003).
The KPCS was officially launched by ministers in Interlaken, Switzerland in November 2002 and KPCS participants implemented the Scheme from the beginning of 2003. Australia is an original member of the KPCS.
Australia implements its KPCS obligations through customs legislation and regulations. Essentially, rough diamonds cannot be imported to, or exported from, Australia unless they are shipped in a tamper-resistant container accompanied by a Kimberley Process Certificate. The diamonds must be coming from, or on their way to, another KPCS participant country.
The KPCS requires participants to nominate importing and exporting authorities. In Australia, the Department of Industry, Tourism and Resources (DITR) has been designated as the export authority and the Australian Customs Service has been designated the import authority. Responsibility for the overall implementation of the KPCS in Australia lies with the Department of Foreign Affairs and Trade.
The Australian Government considers that the KPCS, in conjunction with other international efforts, has contributed to building peace in areas of long-standing conflict in Africa. The KPCS has enabled Australia to contribute to the development of a legitimate and sustainable worldwide trading regime in rough diamonds that includes Africa's many diamond-producing nations. The KPCS has resulted in more 'official' diamond exports and, consequently, higher government revenue for countries previously blighted by conflict diamonds. This helps construct sustainable peace.