De Beers, the South African mining group, will attempt today to clean up the diamond trade by demanding a guarantee from buyers that they are not dealing in “conflict diamonds” smuggled out of Africa.
Any diamond manufacturer found to have purchased stones that fuel wars in Africa will no longer be able to buy from De Beers, which controls 60 percent of the world’s uncut diamonds.
The South African company’s move is a response to mounting international criticism and to fears inside the industry that diamonds could face a consumer boycott similar to the one that hit the fur industry.
De Beers, chaired by Nicky Oppenheimer, argues the policy will drive a wedge between the legitimate and illegitimate sides of the industry, forcing manufacturers, mining groups and jewellers to follow. “We want to get to the point where consumers have the choice of going to guaranteed jewellers, and pay a full price, or go to discounted jewellers that cannot offer a guarantee that their diamonds do not come from conflict areas,” a person close to De Beers said.
De Beers’ stance comes as the company gives up its long-standing monopoly on uncut diamonds and demands that the industry double its advertising budget. It bowed to shareholder pressure this year and stopped buying surplus diamonds to control prices and started selling part of its $4bn-diamond stockpile.
De Beers wants an industry clampdown in order to avoid a public backlash that would reduce demand and make it more difficult to sell the company’s stocks. The diamond industry has been under intense pressure from lobby groups and a UK government-led campaign to prevent rebel movements in Angola, Congo, and Sierra Leone using the proceeds of diamond sales to buy weapons. Reuters