RAPAPORT… Partnership Africa Canada (PAC) contends that Angola has failed to effectively implement the Kimberley Process despite having made “extraordinary” progress with the diamond industry following five years of peace in the southern African country.
“The government’s implementation of the Kimberley Process – arguably a bedrock upon which the current peace is built – has been based on a misguided and ultimately futile attempt to criminalize garimpeiros (artisanal miners) on the one hand, and a slipshod, half-hearted chain of warranties system on the other,” PAC said in its 2007 Annual Diamond Industry Review on Angola. “As a result, in the crucial informal sector, the current Angolan Kimberley Process simply does not live up to international standards.”
Sources in the Kimberley Process, not familiar with the PAC report, told Rapaport News that Angola was fulfilling its minimum requirements of implementation. He also reported “nervous” rumors that Angola may take the vice chairmanship of the KP, and therefore the 2009 chairmanship, when members meet for the KP’s annual plenary in early November.
The non-governmental organization recommended that the government develop an effective, transparent, believable system for tracking informal alluvial diamonds from production to export, as the current system is “non-functional and violates Angola’s commitments to the KP.”
PAC called upon the KP to require Angola to submit a comprehensive report on its internal controls in the artisanal sector, ensure that better records are kept for rough diamond transactions, and to pressurize Angola to invite a follow-up KP review visit of the country.
Still, the country has come a long way since the days when UNITA guerillas, under Jonas Savimbi, took control of Angola’s diamond provinces, mining the diamonds illegally and using the proceeds to fuel the civil war.
PAC explained that implementation of international controls on these conflict diamonds helped starve the rebel forces of funds, leading eventually to the defeat of Savimbi and the end of the war.
PAC noted the significant progress that has been made by Angola’s diamond industry during the past five years, which has seen production nearly double, from 5 million carats in 2002 to around 9.5 million carats in 2006.
Revenue from diamond sales have also doubled through the five years to $1.2 billion in 2006, while government income has more than tripled to $165 million. Similarly, state-owned Endiama went from being in the red by $2.1 million in 2001, to record profits of more than $3 million in 2003.
The number of active diamond projects has grown to 12 by mid 2007, with another 15 expected to come on line in the next few years, and 30 more beyond that engaged in large scale prospecting, PAC reported. These projects currently employ more than 10,000 people, of which some 90 percent are Angolans.
The statistics, however, have not helped to alleviate poverty in the country and the report said that local communities suffer disproportionately from the exploitation of the country’s diamond resources.
PAC explained that the government and Endiama have been known to give away large percentages of various joint venture projects to political friends and insiders who “contribute little to the success of the joint ventures, and have done nothing to merit such largesse.”
“Worse still, the money they receive is effectively robbing the people of Angola of funds that could have been used for development,” the report added.