Update: KP Fails to Approve Zimbabwe Diamond Sales, Country Official Defiant, Says it will Sell them Anyway

Photo by Tsvangirayi Mukwazhi, AP

After four days of closed-door meetings, officials representing the Kimberley Process have failed to reach an agreement on whether Zimbabwe will be able to sell diamonds through the organization’s certification scheme.

“An agreement has not yet been finalized,” Boaz Hirsch, KP chairman reportedly told a news conference Thursday in Jerusalem, where the KP plenary meeting was held. “We are still working with Zimbabwe and other countries.”

Meanwhile, Zimbabwe's mines and mining development minister, Obwet Moses Mpofu, said the country would sell diamonds "immediately" from Marange.

“Zimbabwe will sell diamonds without any conditions,” he reportedly said. “There is no opposition to that.”

Zimbabwe wants to export diamonds from its controversial Marange field, where human rights groups allege it is the scene of forced labor, torture, beatings and harassment by government troops. The southern African country denies all allegations.

The African nation has threatened to flood the world market with underpriced diamonds if it is not allowed to export, The Associated Press reports.

The Kimberley Process is charged with preventing trade in “blood” or “conflict” diamonds, the term used for diamonds mined in a war zone and sold to finance an insurgency, invading army's war efforts, or a warlord's activity.

Foreign and domestic human-rights organizations have criticized Zimbabwe for violence against civilians in the Marange diamond fields of eastern Zimbabwe. The criticism led to investigations by the Kimberley Process over the past year. Zimbabwe was allowed to hold two diamond sales in August and September under the watch of the KP.

Report: Kimberley Process Officials Debate Zimbabwe Diamonds

Photo by Tsvangirayi Mukwazhi, AP

Kimberly Process Certification Scheme officials are at a stalemate on whether to remove all restrictions on Zimbabwe's s sale of diamonds from the controversial Marange field, Voice of America and other media agencies reports.

KP officials meeting in Jerusalem are expected to reach a final decision today, according to the reports. The Kimberley Process is charged with preventing trade in “blood” or “conflict” diamonds, the term used for diamonds mined in a war zone and sold to finance an insurgency, invading army's war efforts, or a warlord's activity. There is debate on whether there are human rights abuses in Marange field and, if so, whether the diamond industry should continue to trade in one of the largest diamond areas in the world.

The organization is going over a report about trade in the diamond fields in the Southern African country. Bloomberg News, quoting KP chairman Boaz Hirsch, said the report offers mixed results.

Foreign and domestic human-rights organizations have criticized Zimbabwe for violence against civilians in the Marange diamond fields of eastern Zimbabwe, Bloomberg News reports. The criticism led to investigations by the Kimberley Process over the past year. Zimbabwe was allowed to hold two diamond sales in August and September under the watch of the KP.

Human Rights Watch, the New York-based advocacy group, alleged in June 2009 that Zimbabwe’s military may have killed as many as 200 informal miners working at Marange. The group had called for a ban on Marange diamonds unless Zimbabwe adheres to Kimberley Process standards, Bloomberg reports. Zimbabwean Mines Minister Obert Mpofu, who is attending the Kimberley Process meeting in Israel, denied there were any remaining areas of non-compliance.

UK Diamond Firm, Jewelry Buying Group Ban Zimbabwe Diamonds

UK-based diamond jewelry company MasterCut is refusing to buy rough diamonds from the Marange fields in Zimbabwe because the company said it doesn’t believe the human rights abuses that forced an international  ban on the diamonds hasn’t ended, according to media reports. The company has gone so far as to rally others to support its effort.

In addition, the Company of Masters Jewellers, which is the exclusive buyer of MasterCut diamonds, supports MasterCut's ban. CMJ is the largest independent jewelry buying group in the UK.

“We believe industry leadership is required to maintain consumer confidence, and would call on other diamond brands to confirm no Zimbabwean diamonds are being used in their diamond jewelry,” James Maxwell, MasterCut group marketing and strategy director, reportedly said. “Diamonds should be a force of good for Africa. Botswana has been a role model in sub-Saharan Africa, where it has demonstrated how diamond revenue can be channeled back into infrastructure, healthcare and education.

“We look forward to the time when we can buy from Zimbabwe, when diamonds are shown to be demonstrably beneficial to the country.”

Willie Hamilton, CMJ chief executive, reportedly added: “I support the ban one hundred percent. We jointly made this decision."

He continued, “There is too much uncertainty over whether the diamonds coming out of that country will be ethical. What constitutes ‘ethical’ also needs to be more comprehensively defined.”

The two groups have now joined the Rapaport Diamond Trading Network (RapNet), which has also banned diamonds from Zimbabwe. Martin Rapaport, who owns and operates the international diamond trading network, has warned its members that trading diamonds from Zimbabwe's Marange diamonds fields will result in expulsion from the network and having their names disclosed.

Beginning in 2008 the Zimbabwe army took over the Marange fields forcing out tens of thousands of small-scale miners. These miners were massacred by soldiers and villagers have been beaten, raped and forced to work as virtual slaves. The human rights abuses led to Zimbabwe's being suspended from the Kimberley Process, an organization of governments, diamond dealers and non-government organizations that attempts to combat “conflict” or “blood” diamonds by using a certification process to trace rough diamonds to their origins.

The KP voted to reinstate Zimbabwe in July, allowing two supervised exports of rough diamond from the Marange production. The first auction of 90,000 carats was held August 11and reportedly raised $72 million.  The second sale is scheduled for September 6.

RapNet Bans Zimbabwe's Marange Diamonds

In two strongly worded statements, the Rapaport Diamond Trading Network (also known as RapNet), has warned its members that trading diamonds from Zimbabwe's Marange diamonds fields will result in expulsion from the network and having their names disclosed.

Martin Rapaport (pictured), who owns and operates the international diamond trading network, wrote the statements on August 12 and 15, which are on the Rapaport Web site.

He warned members that even though the diamonds sold August 11 were cleared by the Kimberley Process certification program—an international organization that attempts to ban the sale of “blood” or “conflict” diamonds (which refers to a diamond mined in a war zone and sold to finance an insurgency, invading army's war efforts, or a warlord’s activity)—trading these diamonds may still be illegal in the US, UK and EU.

Beginning in 2008 the Zimbabwe army took over the Marange fields forcing out tens of thousands of small-scale miners. These miners were massacred by soldiers and villagers have been beaten, raped and forced to work as virtual slaves. The human rights abuses led to Zimbabwe's being suspended from the Kimberley Process. The KP voted to reinstate Zimbabwe in July.

“Rapaport strongly advises all diamond buyers not to trade in KP-certified diamonds from Marange and to request written assurance from their suppliers that their diamonds have not been sourced from Marange, Martin Rapaport wrote August 12. “RapNet, the Rapaport Diamond Trading Network, will not allow the trading of any diamonds sourced from Marange, Zimbabwe. Members found to have knowingly offered Marange diamonds for sale on RapNet will be expelled and their names will be publicly communicated.”

On August 15, he wrote a letter to the dealer network, which he also made public on his Web site, stating that anyone who wishes to cancel their membership because of the restriction can do so within 30 days and receive a refund for the unused portion of their RapNet subscription.