Confidence and Respect on the Road to Change

What changes does the U.S. want to make in the way diamonds are traded? What oversight would they like to have for rough as well as polished diamonds? The backdrop to these questions is a desire to tackle a whole host of issues, from human rights to money laundering, through to consumer confidence.

On January 1, 2012, the U.S. will take over as Chair of the KP. The U.S. was always actively involved in the process, especially over the past few years, when issues such as Zimbabwe and Venezuela were at the forefront. It is interesting, therefore, to consider what the country has in mind for its tenure.

When Boaz Hirsch became KP Chair on behalf of Israel in 2010, he told me that rather than have a long list of goals, he preferred to have only two or three aims and to carry them through. Little did Hirsch know that he would be blindsided by Zimbabwe. His goals – forming a permanent secretariat, establishing a workgroup for the resolution of problems and resolving the situation in Zimbabwe – were not achieved during his tenure, though some were eventually agreed upon earlier this month.

Recently, officials at the State Department started thinking about their term, and began a series of discussions about what their leadership should entail. If the U.S. defined just two or three goals, what could they be? Clearly, as stated in the past, the U.S. is after a more effective and efficient system; in particular, one that looks beyond the narrow rebel-wars-financed-by-diamonds that defines KP and that is no longer the main scope for many observers of the diamond trade.

This would mean a KP that includes human rights issues and greater transparency. However, these are not specific, draftable, goals. For some time there has been talk about the Responsible Jewellery Council’s Chain of Custody as a basis for change – either using it to replace KP or to enhance it. While there is some support for this idea – mainly by the organized industry in the U.S. and a few producers, namely Rio Tinto and BHP Billiton – almost everyone else is against it.

The reasons for this opposition are many. For example, KP is anchored in laws, while RJC's system is voluntary. Far beyond that, however, a fundamental issue needs to be addressed. It seems like a far-fetched move – complicated, controversial and too far off to complete in a year – to replace one system with another, just because of a number of flaws in the current system that almost everybody acknowledges. A more reasonable approach, surely, should be to correct what we already have and keep on working together.

To borrow an analogy from the democratic system, if you don't like the policies of your government, you vote someone else into office, you don’t stage a coup and change the system of government.

Everyone involved is tightlipped about the upcoming year. Some resist any major changes to KP, others want to see a completely new system while the sentiments of most of the others lie somewhere in between. In a consensus-based system, this means that far-reaching changes are hard to enact.

For these reasons, the U.S. is considering a modular approach: tweaking the system within consensus, while at the same time adopting – and encouraging others to adopt – a far stricter system that would be applied locally.

One of the ideas we believe the U.S. is considering is implementing the decision to form a secretariat and improve transparency within KP while formulating polished diamond regulations overseeing trade in and with the U.S. This is no different to the U.S. not opposing the resolution on Zimbabwe in KP while maintaining a ban on the import of goods from Marange.

Whatever the U.S. decides to do, it can only be hoped that the goals are worthy, forward-looking and implementable. After two years of Zimbabwe zib-zabing in our ears, what the KP needs more than anything is leadership. The U.S. needs to step up to the plate with confidence in its ability to implement much-needed change and respect the voices of those that live and breathe the diamond trade every single day of the year.