Susan Njanji | Freetown, Sierra Leone19 August 2007 found
at mg.co.za/
As it pieces together its shattered mining sector after a 10-year civil war
fuelled by so-called "blood diamonds", Sierra Leone is turning
attention to processing its uncut gemstones.
For years, the diamond-rich West African country has mined diamonds and exported
them raw, but as the industry gradually edges its way up back to pre-war levels,
the focus is now on "beneficiation", as it is known in the industry.
A new law was recently passed to license and monitor the cutting and polishing
of rough diamonds, a gem first mined in the 1930s in Sierra Leone.
"There is no cutting going on at the moment, but the government has adopted
a policy to add value to most of our minerals, including diamonds," Mines
Minister Swarray Deen said.
But
the plan is not without hurdles. Sierra Leone's leading mining consultant,
Andrew Kilie, says huge amounts of the stone are
required to sustain a cutting and polishing plant. Skilled workers to do the
work are also not readily available in the impoverished country rated the second
least developed in the world.
"In cutting diamonds, you need volumes of stones and the skills to do it.
The skills base is not there," said Kilie.
He said most of the small-scale producers and alluvial panners who produce about
80% of the country's diamonds are organised into cartels that sell to markets
abroad. Some of the producers are backed by the foreign buyers for whom they
have set quotas.
"So, to convince the dealers to sell locally is not going to be easy,"
said Kilie. "We are not saying it cannot be done, but it is
complicated," he added.
Government director of mining Alimany Wurie said local exporters have made a
pledge to sell to local cutters. "The availability of diamonds on the
market could be one challenge, although exporters have made a commitment to sell
to local cutters."
Increased revenue on government levies and job creation have been the motivating
factors behind promoting diamond cutting and polishing. If polishing takes place
inside the country, "it creates employment and results in increased revenue
to government", said Wurie.
The government levies a 3% tax on all diamonds exports, and processed stones
fetch a higher value and more revenue.
But since cutting and polishing is not labour intensive, few in Sierra Leone --
reeling under a 70% unemployment rate -- are to reap benefit directly from the
planned venture.
No diamonds at home
Even if polished here, not many of the stones are likely to be used here. A
Freetown jeweller said diamonds are not appreciated in Sierra Leone.
"Ordinary Sierra Leoneans know or have heard about diamonds, and that they
are valuable, but they prefer to invest in land and property than
diamonds," said Riad Hassan, who runs one of the very few jewellery shops
in Freetown.
"And in any case, many cannot afford it," said Kilie. Seven in 10
Sierra Leoneans live on less than $1 a day.
About half a dozen American, Russian and British companies have expressed
interest in setting up shop on cutting and polishing of the gems.
In all, Sierra Leone's mining industry used to account for 20% of the national
economy and raked in nearly 80% of export earnings before the war, according to
the government. "We are working on meeting those levels and even doing
better than that," said Mines Minister Deen. Diamonds used to account for
half of revenue.
The country's established diamond fields cover an area of nearly 20 000
square kilometres, about one-quarter of the country, mainly in south and eastern
parts, according to government documents.
But the 1991-2001 rebel war in which the stone was smuggled out in exchange for
arms -- the origin of the "blood diamond" tag -- saw the gem lose its
sparkle in official channels.
With greater access to mining areas, annual earnings have been rising steadily,
reaching $125-million last year, and are expected to rise to $160-million this
year.
The international diamond-tracking system know as the Kimberley Certification
Process, aimed at curbing illicit diamond trading, and a sub-regional plan that
tries to harmonise diamond taxes in Sierra Leone, Liberia, Côte d'Ivoire and
Guinea have been credited for improved earnings. -- Sapa-AFP
