Martin Rapaport on Conflict Diamonds

Martin Rapaport addressed an international audience on June 5, 2006 at the JCK convention in Las Vegas.  His main points were economics, distribution and ethical issues in the diamond and jewelry trade.  Here is our summary of his comments:

Conflict Diamonds

A first order problem meets 4 criteria:  Intensity; it is a matter of life or death.  Scope; it influences many people.  Complexity; it is a developmental problem.  Impact; there is high level industry damage. 

The plight of artisanal diamond miners in West Africa is a first order problem.  There are 1,000,000 artisanal diggers in Sierra Leone, Congo, Angola and West Africa.  These are the world’s poorest people.  The diamonds there are alluvial and hard to control.  There is no alternative employment.  Wars are a way of life.  Sierra Leone is the world’s poorest country.  Life expectancy is 40 and they have the world’s highest infant mortality rate.  70% of the people live on less than $1 per day.  94% of Sierra Leone’s exports are diamonds.

The industry is aware of the plight of these people.  Our leaders are doing the right things.  The Kimberly Process stems the flow of diamonds from these countries.  This is a corporate approach that is designed to protect the industry.  Similar protectionist approaches promote “Canada” products or call for a complete boycott of diamonds from such counties.

None of these things address the root problem:  These philosophies are all product-based, not people-based.  A boycott would actually hurt the people who need our help the most.  Remember that 94% of Sierra Leone’s exports are diamonds.  A boycott would take away the $1 per day those people have now.

How is it possible that Sierra Leone exports hundreds of millions of dollars in diamonds per year but people are still starving?  The political obstacles to creating free, fair and competitive markets in these countries are historically considerable.  Many are created by governments, not industry, but as an industry we must face them.

Ethical issues are dangerous because we ignore them until they cause us pain; like waiting until a tooth hurts to go to the dentist.   Doing "the right thing" can be difficult, especially when you don’t know what to do.  But remember:  A decision not to do something is also a decision.]

The forthcoming "Blood Diamond” movie may cause us pain.  We will be asked questions.  The toughest questions will not come from our customers, but from our friends and families.  We have been shielded because the Kimberly Process and the Council for Responsible Jewelry Practices work to stop these diamonds from reaching American markets.  We protect our clients from “blood diamonds” and point to Botswana and the wonderful public education system the diamond trade has created there as a positive example.  We point to "Canada" diamonds as an alternative.  But in some areas of Africa people are still suffering.

So, is our problem really a movie?  Or is it the fact that 1,000,000 people are suffering?

What can the diamond industry do about this?  We need a people-based solution, not a product-based one.  Can we open the markets of these renounced countries?  Can we employ a labeling organization for ‘fair trade jewelry’ that will ensure that a portion of monies is put directly back into humanitarian solutions?  Can we create fair and competitive diamond markets in the poorest areas of Africa?  Such a proposal would address the root cause of the problem:  The poverty of those who dig diamonds.  Governments could realize increased value and legitimized trade by agreeing to terms whereby money is directed back into relief efforts; ensuring the product did no harm, only good.

Imagine buyers able to present a token of love; the purchase of which possibly saved lives? Such ‘spiritual sparkle’ is beyond price - See Dreams of Africa™.

If we as an industry can use our economic purchasing power to create market forces which drive out exploitation and poverty, such ‘fair trade jewelry’ has the potential to be the jewelry product of the century.