FJA’s Greg Valerio talks with Ambassador Gillian Milovanovic – the Chair of the Kimberley Process

GV: Can I start by asking what the role of the Kimberley Process is in the diamond industry and specifically what your role is as the KP Chair?

GM: The Kimberley Process Chair organizes the work of the KP for the year, chairs the Intersessional and Plenary meetings, and helps ensure that prior KP decisions are implemented. A main focus of my term as Chair is to provide the full support of the U.S. government to the KP’s ongoing reform efforts, including through consultations with civil society groups, the diamond industry, and participating countries.

GV: Can you ever envisage a day when there will be no conflict diamonds in the diamond supply chain?

GM: The joint efforts of governments, industry leaders and civil society representatives have enabled the Kimberley Process (KP) to curb successfully the flow of conflict diamonds in a very short period of time. Diamond experts estimate that conflict diamonds now represent a fraction of one percent of the international trade in diamonds, compared to estimates of up to 15% in the 1990s. That has been the KP’s most remarkable contribution to a peaceful world, which should be measured not in terms of carats, but by the effects on people’s lives.

GV: What do you think about the relationship between Zimbabwe and China? For many jewelers selling diamonds from Zimbabwe is the biggest threat to our industry. State sponsored oppression being paid for by the sales of diamonds that are then manufactured into jewelry in China and sold to western consumers?

GM: On Zimbabwe the KP Plenary in Kinshasa decided on a way forward for exports from the Marange diamond fields in Zimbabwe.  As Chair, we work to ensure that the terms of the decision continue to be respected. However, the pre-November 2011 impasse in which the KP found itself showed the limitations of the KP and the need for overall KP reform, which the KP itself decided, at the Kinshasa plenary, to begin to address. It is the KP’s decision, by consensus, to review the KP’s core documents and definitions and to evaluate the need for reform, that forms the core of the US Chair’s agenda for our chairmanship.   I visited China as Chair and had excellent meetings with KP industry and government representatives in Beijing, Shanghai and Guangzhou.  China agrees that reform and modernization are needed to deal with future challenges.  China is an active participant in the KP, including in its Working Groups and we encourage China to take an active leadership role in the KP during this period of growth.  China’s diamond market is growing rapidly and industry there is facing enormous challenges.  We look forward to collaborating with China throughout our Chairmanship and beyond.
GV: Can you explain what the deadlock is concerning Human Rights within the KPCS and their inclusion into the definitions of what constitutes a Blood Diamond? Many jewelers fail to understand what the problem is, all they see is bureaucracy and an avoidance of dealing with the truth in Zimbabwe.

GM: The KP was created both to prevent illegal diamond revenues from funding insurgencies against legitimate governments and to ensure the continued health of the market for diamonds worldwide.  The KP’s founders took far-sighted steps to ensure that the diamond resource within their borders would continue to attract customers and provide both much-needed revenues for development and equally needed jobs in many countries around the world. Today we call on KP members to be equally far-sighted in modernizing the KP’s definitions and functioning to ensure that the economies of diamond producers – many of them in Africa— as well as those of cutting and polishing and of consuming countries, continue to benefit from a sound market for their product.  Ensuring that consumers worldwide continue to seek out this exceptional gem stone requires that we all look at and prepare the KP for today’s and tomorrow’s challenges.  If we do so, and do so together, not only will no sector or region be targeted unfairly but all will benefit.

GV: As I understand it, the KPCS is a customs procedure for tracking the flow of rough diamonds around the world. Yet for the jewelers it acts as a  consumer confidence mechanism that helps to bolster the public’s confidence in the diamond value chain. What steps does the KPCS need to take in order to restore jewelers and consumer confidence in the diamond story?

GM: Only rough diamonds are accompanied by KP certificates. Once diamonds are cut and polished, KP certificates are not required to trade them internationally. Moreover, the KP is a tool that currently addresses one specific problem: the use of diamond revenues to fund civil wars. If consumers want to know more about the diamonds they purchase – for example, whether the diamonds were associated with violence or human rights abuses, or have been used to fund corruption or suppression of democracy – then they need to ask tough questions of retailers.

GV: Institutionally what steps do you believe have to be taken to make the KPCS a stronger and more democratic and publicly accountable organization?

GM: The need for an administrative support mechanism, which is much smaller and less complex than a Secretariat, has been identified within the KP for some time, and the full KP Plenary mandated in November 2011 that the ad hoc KP review committee pursue this effort.  We continue to believe that such a permanent support mechanism is needed for the KP to truly serve its membership – and the broader public – and we will work to support the review committee’s engagement with existing international institutions to evaluate options for this.  We’re excited about improving internal communications, creating institutional memory and making the KP website up-to-date with the newest technologies.  We’re also seeking to strengthen cooperation on enforcement and encourage a greater focus on domestic implementation.
GV: As I understand it the KPCS is constituted as a tripartite arrangement between Governments, Diamond Industry and Civil Society. Do these groups have an equal say in the KPCS and if not why not?

GM: Governments, the diamond industry, and civil society make up the KP. All three have valuable roles to play and we seek to harness everyone’s talents to improve the KP.  This is a consensus-based process in which, though only governments have the right to vote in the formal decision-making process, everyone’s participation is needed in the shaping of the consensus and in finding solutions to improve the KP.  The diamond industry and civil society have been an integral part of the KP from its outset. Formally, they are designated as “Observers,” but they take a very active role in the day-to-day work of the KP. Their contributions are essential to the KP’s working groups – where most of the KP’s functioning occurs – and to the peer review system that monitors compliance. As with other aspects of the KP, their role will be one of the topics addressed in the review process being led by Botswana.
 
GV: What is the one thing that the KPCS can do for the small-scale diamond miner who is after all the majority stakeholder (when employment and livelihoods are considered) in this industry and also the most vulnerable to exploitation, corruption and abuse at the hands of rebels or unscrupulous and coercive governments?

GM: KP members, working in the spirit of the KP, have been focused on improving the development outcomes associated with diamond mining, including via a stronger focus on local communities and artisanal miners in producing countries.  KP members worked together to improve artisanal miner registration in Ghana and the Democratic Republic of the Congo. Experts within the KP have enhanced understanding of diamond valuation and improved diamond mining techniques in Sierra Leone and Guyana.  A KP member project has secured land tenure and stable incomes for artisanal miners in the Central African Republic and Liberia.  Most recently, members of the KP banded together to hold a development conference in an attempt to keep all of the players in a holistic mindset, become improving the lives of small-scale miners is a key goal of the KP.

GV: What will be legacy of  the US holding the KP chair be?

GM: Our overarching objective for the year is to achieve an array of reforms to make the KP more effective, efficient, and relevant.  To achieve these reforms, we are promoting open, transparent, and broadly consultative processes.

GV: Thank you for taking the time to talk with me, I trust that some of the structural issues within the KPCS will be resolved at the next full plenary and we will see a stronger system emerge that will restore faith across the entire industry.

---