Statement of Alan Eastham, Special Negotiator for Conflict Diamonds,
U.S. Department of State

Testimony Before the Subcommittee on Trade
of the House Committee on Ways and Means

Hearing on Conflict Diamonds

October 10, 2001

Thank you for this opportunity to report on our efforts to deal with the role of diamonds in conflict. I am very grateful to the Committee for organizing what I believe will be a very significant event, a chance for the world to see first-hand the interest in Congress in this issue and to assemble the views of various experts as we prepare for the next round of "Kimberley Process" talks in Angola at the end of this month.

The natural wealth represented by diamonds should be a source of funds for development and human welfare in Sierra Leone, Angola and other countries in Africa.  Instead, in all too many cases, the money produced by diamond sales provides the funding for rebel movements to purchase illicit arms and to support rebel armies, prolonging civil wars that have terrorized societies and destroyed communities. While conflict diamonds have been estimated to make up only about four percent of the world diamond trade, they have a disproportionate impact on the welfare of certain populations.

-- In Angola, where UNITA exported between $3 and 4 billion worth of diamonds from 1992 to 1998, over half a million lives have been lost, more than three and a half million people have been displaced, and over 300,000 refugees have fled the country.

-- In Sierra Leone, diamonds have helped transform a band of about 400 rebels of the RUF into an army of thousands that has become infamous for its brutal treatment of civilians, including particularly horrific atrocities against children. The civil war in that country has killed more than 50,000 people, displaced over one-third of the country's population of 4.5 million inhabitants, and sent over 500,000 refugees abroad.

The Fowler Report of March 2000 on UNITA activity in Angola and the landmark report by the British NGO Global Witness helped to build a consensus within and outside governments that we must confront and break the linkage between diamonds and conflict, while permitting the legitimate trade, a source of wealth for nation-building, to continue and flourish.    Our government began to work towards this goal with the objective of choking off the money from diamond sales that fuels violence and building peace and stability in west and central Africa.  At the same time, we recognized that the economies of other countries, such as those in southern Africa, benefit greatly from diamond exports and must not be harmed by our efforts to stop conflict diamonds.

We have attacked conflict diamonds through two avenues: the United Nations and the Kimberley Process.  We chose to do so because we recognized that joint efforts by all diamond trading nations would be immeasurably more effective than action by one country alone.  We are still convinced that this approach is valid.  It is consistent with our international obligations.  It recognizes the inherent nature of the diamond trade.  And it is a reflection of the inter-connected global market realities of today's world. 

In the United Nations Security Council, we chose to prohibit the direct or indirect import of diamonds from Angola and Sierra Leone, except through controlled certificate of origin regimes.  USAID assisted the government of Sierra Leone in developing a certification system that provides a secure, legitimate channel for diamonds to be exported from that country. 

More recently, we have supported efforts by the Security Council to reduce sanctions leakage to try to dry up funding for these insurrections.  The most significant of these was UNSC Resolution 1343 last May that banned rough diamond imports from Liberia, in response to its government's support for the RUF.

 Outside of the formal United Nations processes, we have sought a broader solution to the conflict diamonds problem through what has come to be known as the Kimberley Process.  This Process was initiated in Kimberley, South Africa, in May, 2000, when representatives of key producing, trading and consuming countries, the diamond industry, and civil society began a series of meetings to examine the conflict diamonds problem.  Their efforts culminated five months later with an endorsement of a global system for preventing conflict diamonds from entering the legitimate trade.  On December 1, 2000, the U.N. General Assembly endorsed Kimberley and called for its members to broaden participation and develop minimum acceptable standards for certification.

 An expanded Kimberley process, with over 35 governments participating, has held four meetings this year to establish the details of this system.  At the first meeting in February in Namibia, delegates agreed to a road map that established benchmarks for subsequent meetings, with the objective of presenting the details of a system to the United Nations Secretary General by December 1, 2001 -- the anniversary of the General Assembly resolution.

 I am pleased to report that Kimberley has kept to this road map.  At its most recent meeting, on September 11-13 in London, delegates revised a draft document that set out the essential elements of a system.  These elements include: the use of forgery-resistant certificates and tamper-proof containers for shipments of rough diamonds, internal controls and procedures which provide credible assurance that conflict diamonds do not enter the legal market, and effective enforcement of the system through dissuasive and proportional penalties.  The London meeting made significant progress toward outlining how this system would work, both in terms of physical security of diamond shipments and in the procedural requirements, including internal control measures, which would underpin a certification system.  However, there was not as much progress as we would have liked in coming to conclusions regarding the obligations governments and industry would undertake in such a system.

 Some of these questions are quite significant and how we answer them in Kimberley goes to the heart of whether a global system will be effective.  I know that Members of Congress are very concerned about the length of time the Kimberley Process is taking to come to grips with these issues, and that you will ask me whether I think Kimberley will succeed in the objectives outlined for us in the U.N. General Assembly Resolution.  Given where Kimberley stands at the moment, I don't have an answer to that question; what I can assure you, though, is that the U.S. team will put its maximum effort toward achieving a workable system in the two remaining meetings forecast in the roadmap.

Kimberley participants plan to hold two more meetings before preparing the mandated December report for the Secretary General.  At these meetings, we will focus the discussion on the essential elements of a system that will work, that is simple, effective, and cost-effective, and that will to the maximum extent possible get to the heart of the problem so that we can move on to put it in place and break the link between the diamond trade and conflict.     

We appreciate congressional interest in addressing the conflict diamonds problem, which has helped to motivate Kimberley participants to work more quickly towards developing a global system.  The congressional sponsors of the Clean Diamonds Act have realized a significant accomplishment by bringing together the diamond industry and interested non-governmental organizations in support of a single piece of legislation.  We also appreciate their efforts to listen to our views, and their willingness to learn about the Kimberley Process.

 Let me repeat:  We remain committed to creating the most effective system possible to control the trade in conflict diamonds and are pleased to work with Congress towards achieving this goal.  We will certainly need Congressional support, and we will probably need legislation if we are to carry out the steps eventually to be agreed within the Kimberley process.  We will work closely with you, with your staff, with industry, and with the NGOs toward this end.