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Westminster Hall

Thursday 26 April 2001

[Mrs. Sylvia Heal in the Chair]

Conflict Diamonds

Motion made, and Question proposed, That the sitting be now adjourned.--[Mr. Clelland.]

2.30 pm

The Minister of State, Foreign and Commonwealth Office (Mr. Brian Wilson) : I welcome this opportunity to set out the international response to the problem of conflict diamonds and the role that the United Kingdom has played in tackling it. This is an important international problem, and this country has worked with others to find new solutions. I want to say at the start that, although the problem of conflict diamonds has arisen primarily in the context of conflicts in Africa, it is not only an African issue. Solutions will require a concerted approach that involves many key players, Governments and industry throughout the world.

Two key aspects have guided our approach to the problems of conflict diamonds. First, rebel movements in countries such as Angola, the Democratic Republic of Congo and Sierra Leone are undoubtedly being funded and fuelled by the proceeds of illegal diamond mining. Diamonds mined in rebel-held areas are often sold for weapons and thereby help to perpetuate violence. More fundamentally, access to diamond areas can often be an end in itself for rebel groups and their backers. Civil war thus becomes a cloak for the ruthless exploitation of a nation's diamond wealth, and that must not be allowed to continue.

Secondly, however, it is sometimes forgotten and it is important to emphasise that the legitimate trade in diamonds is enormously important to the economies of countries such as Botswana, Namibia and South Africa. Diamond revenue is vital to their economic development. Again, that is not only an African issue. In India, which is a major processor of rough diamonds, 800,000 people depend on the industry for their livelihood. We therefore need to protect that industry from the taint of conflict diamonds. They can have no place in the legitimate trade, on which the livelihoods of so many depend.

Some have said that, if nothing is done, a consumer backlash against diamonds could lead to them going the way of fur, and we must work to avoid that. I want to make it clear that I totally oppose any talk of boycotts of diamonds. Such initiatives would be counter-productive and irresponsible because of the economic implications for countries that depend on the legitimate production of diamonds.

In that context, it is important to keep a sense of perspective. Estimates vary slightly, but conflict diamonds probably account for less than 4 per cent. of worldwide production. Apart from economic damage, it causes understandable offence to the Governments of legitimate diamond-producing countries when it is suggested in a vague, offhand way that the whole diamond trade, or a high proportion of it, is tainted.

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That suggestion is not true, and I welcome this opportunity to re-emphasise the fact, which is now widely accepted, that conflict diamonds account for 4 per cent. or less of worldwide production. The problem is that the illegally traded minority can turn up wherever diamonds are bought or sold--from London to Tel Aviv and from Antwerp to Bombay. That is why we are working with the international community to try to keep conflict diamonds out of legitimate diamond markets.

We can do that, first by working through the United Nations Security Council to address the problem of conflict diamonds in specific situations. The UK, as a permanent member of the Security Council, was instrumental in pushing through Security Council resolutions to impose sanctions on Sierra Leone and Liberia. The Security Council also acted to halt the trade in conflict diamonds in Angola in 1998 by imposing a ban on the import from Angola of diamonds that were not controlled by the Angolan Government's certification regime. In 1998, the Security Council adopted a resolution banning the import of diamonds from UNITA. That was a groundbreaking step, as it was the first time that the Security Council had targeted the trade in conflict diamonds. Since then, the Security Council has worked hard with the Government of Angola and others to tighten the grip of the ban. In 1999, in another important initiative supported by the UK, the Security Council commissioned a detailed report on UNITA sanctions busting. That has led to further efforts to tighten implementation of the diamond ban.

Sierra Leone is another nation that has been accursed by its own diamond wealth. For years, the Revolutionary United Front rebel movement has financed itself from the illegal plunder of the diamond fields of Sierra Leone. Last July, the UN Security Council adopted resolution 1306, drafted by the UK, which bans the import of diamonds from Sierra Leone except those certified as legitimate by the Government of Sierra Leone. We also proposed the first ever UN hearing to assess the role of conflict diamonds in the Sierra Leone conflict and the link between diamonds and arms trafficking. That was held in New York on 31 July 2000. It gave representatives of Governments, industry and civil society an opportunity to brief members of the Security Council's sanctions committee and the media on the dreadful trade and what should be done to end it.

Since the adoption of the ban on uncertificated rough diamonds from Sierra Leone, the RUF has found it harder to make money from diamonds, and official Sierra Leone exports have increased substantially. In 1999, the value of those legitimate diamond exports was $1.5 million. By 2000, that had risen to $10 million. From October 2000 to January 2001, since the certification scheme came into effect, exports rose to $6.4 million. In addition to this, the exit routes for illegitimate diamonds had become more tortuous.

A dreadful aspect of the tragedy of Sierra Leone, which I remember discussing in this Chamber with a Labour and a Conservative Member who had been to Sierra Leone recently, is that although its people are among the poorest in the world, their diamond wealth goes to the rebels and to neighbouring countries such as Liberia.

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Liberia must bear direct responsibility for the perpetuation of the Sierra Leone conflict. Resolution 1306 also established an expert panel to collect information on violation of Sierra Leone's arms embargo and the link between the diamond and arms trades. The panel's report provided unequivocal evidence that Liberian support has provided rebels with arms and safe havens in return for conflict diamonds, so international pressure has been stepped up on Liberia to close down its links with the rebels. In March 2001, the UN Security Council unanimously adopted resolution 1343, which calls on Liberia to end its support for the RUF rebels before 7 May 2001. If it does not, there will be a ban on the import of all rough diamonds originating in or exported from Liberia. So far, there has been no evidence of a clear commitment by the Liberian Government to break its link with the rebels, so the ban is expected to be introduced, as foreseen in the resolution.

However, UN Security Council resolutions are not the only weapons needed to tackle the illicit trade. Diamonds are, by their nature, easily smuggled; their origin is easily concealed. It is a sad fact that one of the lessons of the resolutions that I have mentioned is that if one stamps out the trade in one country it tends to crop up elsewhere. That is why we need a global approach. It can only be done by agreement within the global community, including the diamond industry. A good start has been made. Members of the industry, from mining companies all the way through the processing chain to jewellery retailers, have already taken important steps to reassure consumers that their diamonds are conflict free. They have also created their own representative group, the World Diamond Council, to ensure that they co-ordinate their efforts to safeguard the legitimate industry. The World Diamond Council has played an active part in formulating proposals to that end, and has given the industry an important voice in the international campaign to tackle conflict diamonds.

There is also a role for Governments. About a year ago, the South African producer states formed the so-called Kimberley group as a fairly informal brainstorming group involving some key countries, industry and civil society. This was an imaginative approach to tackling a new problem. It brought together key producer countries, key importers such as ourselves, representatives of industry and concerned non-governmental organisations.

The Kimberley process, under South Africa's dynamic leadership, together with that of Botswana and Namibia, has generated tremendous international support and commitment. The United Kingdom has played a prominent part in it. We hosted an important meeting of the group in London in October to try to expand the number of countries participating, and we asked for the issue to be placed on the agenda of the United Nations General Assembly. That resulted in a milestone event on 1 December 2000, when the entire membership of the assembly, all 189 countries, adopted a resolution supporting the creation of an international certification scheme for rough diamonds. That was a landmark in this affair.

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What would an international certification scheme for rough diamonds mean in practice? We want an international agreement on a scheme under which Governments would permit the export and import only of rough diamonds certified to come from mines under the jurisdiction of a legitimate Government. That is a simple, straightforward definition. Producer country Governments would have to ensure that all legitimate exports had a proper certificate of authenticity, and importing Governments--the key diamond trading centres, including this country--would have to undertake not to allow imports unless they were accompanied by such a certificate. That would make it much harder for diamonds from rebel-held areas to gain access to respectable international markets.

We want a regime that is relatively simple and not administratively burdensome. We do not want to make life impossible for the legitimate industry, and have therefore resisted calls for a chain of certificates to accompany diamonds all the way from the mine to the jeweller's shop. That would impose a huge burden on countries such as India, where numerous small firms cut and polish diamonds. We believe that a certificate for the import and export of rough diamonds can make a significant contribution to curbing the trade in conflict diamonds. We also believe that some form of monitoring would be desirable, but, again, have no wish to create a huge international bureaucracy.

The UN General Assembly decision gave the Kimberley process the political mandate to press on with the technical negotiations to draw up a global certification scheme. Thirty-eight countries are now members of the group and they include all the key producers and traders. At a meeting in Windhoek in February we agreed on a series of targets to be achieved during the year, so that by September, when another Kimberley process meeting is due in London, an international certification scheme will be close to agreement.

The United Kingdom has worked hard, alongside its partners in the process, to keep up momentum. We realise that the schedule that we set ourselves in Windhoek is a tight one, and that much work remains to be done. While everyone agrees on the desirability of action, there are many details still to be thrashed out. However, we remain optimistic and hope to achieve the next step of securing UN General Assembly blessing for the agreement. We should like a further resolution to be adopted unanimously before the end of the 56th General Assembly.

We could not have succeeded in keeping up the momentum on this issue without the driving force provided by NGOs in the field. We have worked closely with Global Witness, which, with funding from the Government, produced an excellent and highly detailed report outlining recommendations for a global certification scheme.

Mr. Tony Lloyd (Manchester, Central): My hon. Friend will be aware of a recent report by Global Witness about diamonds from Sierra Leone. On the matter of certification, it reported that at present only the Belgians have adequate computer links for monitoring the processes of certification from Sierra Leone. Will my hon. Friend say whether we intend to

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acquire similar capacity? Will we in Britain be able to establish computer links that increase the likelihood that conflict diamonds will not get through?

Mr. Wilson : I did not realise that my hon. Friend had joined us. I acknowledge his role in setting up the present process. I assure him that the matter that he raises, and the concerns expressed by Global Witness, are taken seriously. As I was about to mention, this subject was among those discussed at meetings in Brussels this week, and I hope that we shall soon be able to provide the assurance that my hon. Friend seeks.

In conclusion, we have come a long way in the few years since the process in question began. We have worked closely with the industry and others to tackle a difficult and important subject, which has many connotations and which gives rise to many side effects, often involving immense human suffering. We acknowledge the progress that has been made, but we also recognise that many problems remain to be resolved, and that intergovernmental and inter-agency consultations must be painstaking, and can be difficult to conduct speedily.

However, the Kimberley process is making headway. As I speak, UK representatives are involved in the latest meeting of the Kimberley process in Brussels, and progress is being made. Our aim at that meeting is to negotiate the specific content of an international certification scheme, looking towards agreement on minimum standards for such a scheme, and that must take account of the kind of concerns that my hon. Friend has mentioned. A successful meeting in Brussels this week will take us one step closer to breaking the link between conflict and the illicit trade in diamonds.

I am grateful for this opportunity to set out the progress that has been made and to be open and frank about the difficulties that remain in tackling an issue that I do not think will divide us in any way. If a clear separation could be made between the 96 per cent. plus of diamonds that are legitimate and the 4 per cent. or less that are illegitimate, that would be good for the legitimate diamond trade, for countries that produce diamonds and depend on them economically, and for the well-being of the people of those countries. That 4 per cent. or less can be and are being used to fund a great deal of suffering in the world.

2.46 pm

Mr. Richard Spring (West Suffolk): I thank the Minister for setting out the matter under discussion so openly and comprehensively. Conflict diamonds are an important issue, which certainly transcends any political differences. Hon. Members will be aware that the illegal trade in rough diamonds, however small in the overall context, too often forms an intrinsic part of rebellion and violence, particularly in Africa. The trade has been responsible for destroying the lives of innocent men, women and children.

Like all Conservatives, I welcome wholeheartedly any move that will help those people to resurrect their lives and reunite the families that have been divided by conflict. We must break the link between diamonds and war. It is unacceptable that brutal wars are being funded from the profits of this illegal trade, and it is unacceptable that higher up the chain, rogue traders and

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middlemen are cashing in on it. I should like to join other hon. Members in offering support to all those who have already contributed so much time and energy to a process that we all hope will lead to the regulation of the illegal diamond trade and bring an end to its unhappy consequences.

It was entirely correct and proper for Britain to co-sponsor the resolution on conflict diamonds adopted at the UN General Assembly on 1 December 2000. That resolution should go a long way towards helping to rid the world of the illegal diamond trade. It is important that the recommendations made by the assembly form an integral part of any international strategy. Any such strategy must comply with internationally agreed minimum standards, secure the widest possible participation, include mechanisms to ensure compliance with respect to the sovereignty of states, and be transparent.

The diamond industry united in the creation of the World Diamond Council. That shows us that the industry is concerned about the issue of conflict diamonds, and that it is determined to pull together to tackle it head on. It is particularly pleasing that the industry is putting its own house in order in that respect and that it is committed to identifying and ostracising those who operate on the margins of the legitimate trade and seek to profit from the misery and suffering caused by the trade in conflict diamonds.

De Beers has been highlighted for special praise, not least by the UN Secretary-General Kofi Annan. Earlier this year he said:

We are pleased that the 36 countries that met in London in October realised a common interest in protecting the legitimate trade and that all joined the Kimberley consensus. We are even more pleased that the entire membership of the United Nations General Assembly--all 189 countries--saw fit to accept the need for an international certification scheme and approved a resolution calling for one to be developed in due course. We wish the Kimberley task force well. We all hope that it will be successful in the continuing process of identifying an accountable certification scheme and making it work. We are at the beginning of a long path. However, I am sure that all hon. Members would agree that it is certainly a worthy path.

I come now to the problems caused by conflict diamonds in particular countries. In respect of Angola, hon. Members will be aware that, on 25 January 2001, the United Nations Security Council extended for a further three months the mandate of the monitoring mechanism established to investigate violations of sanctions imposed against the rebel movement UNITA. The recently published final report of the monitoring mechanism assessed the effectiveness of the Security

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Council resolution on the issue. It is a revealing report, which suggests that while much has been done, there is still much progress to be made.

The report said that, even where Governments have both enacted laws and strengthened diamond-trading controls, illicit diamonds are still reaching the market. Gems will find a market as long as illicit diamonds can be traded and until those who are involved in the trade are exposed and penalised, thus making UNITA diamonds a less attractive proposition.

UN sanctions have driven UNITA diamond trading deeper underground and have led to new routes for diamond trading. They have provided the impetus for worldwide controls on diamonds--the certificate of origin scheme. However, the scheme is unlikely to be implemented before the end of this year. We must build on the efforts of those who have already contributed so much, and ensure that an international certification scheme for diamonds becomes a reality. The British Government have a duty to humanity to be an integral part of that process.

The examples of Botswana, Namibia and South Africa show how diamonds have the potential to play a prominent role in development. That role must not be underestimated; nor, therefore, must confidence in diamonds be undermined. I am grateful to the Minister for emphasising that this is not only an issue for Africa.

In Botswana, diamonds account for one third of GDP, more than half of Government revenues and about 80 per cent. of export earnings. They are the reason for the country's tremendous growth. Twenty-five years ago, it was one of the 20 poorest countries in the world. Today, it is considered to be the richest non-oil-producing country in Africa. As its President, Festus Mogae, has said:

However, to the dismay of people like President Mogae, even in Botswana, the legitimate trade is in danger of suffering great damage because of illegal diamond trafficking, which, although it should be noted accounts for less than 3 or 4 per cent. of the world's total production of diamonds, has the potential to taint the entire industry. Image, especially for diamonds, is crucial.

The most publicised effect of conflict diamonds has been in Sierra Leone. We welcome the United Nations Security Council's unanimous vote to block diamond exports from Liberia in punishment for its guns-for-gems trade in support of the rebel RUF in Sierra Leone. We are, however, disappointed that the ban on diamonds, along with the travel embargo on President Charles Taylor and several Liberian officials and business men, will not come into force until 7 May. It was right to leave President Taylor and his associates in no doubt that the international community will no longer tolerate his destabilising activities in the region.

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A recent Global Witness report states that Sierra Leone may be exporting conflict diamonds through official channels, despite a United Nations embargo. That is deeply worrying and serves to confirm the conclusions of the UN Security Council monitoring mechanism for Angola.

In the light of that report, the role of the international peacekeeping forces in Sierra Leone appears to be yet more significant in the fight against the illegal diamond trade. Focus has also been cast on the May 1999 Lome agreement. Under that agreement, the RUF was recognised as a legal political party and was given seats in the Sierra Leone Government. The rebels were also given a guarantee that they would not be prosecuted for the atrocities that they had committed against the civilian population. The RUF leader, Foday Sankoh, was given a key Government post as chairman of the strategic minerals commission, which oversees the exploitation of the country's diamond wealth.

This debate provides a good opportunity to consider objectively how the illegal diamond trade affects countries specifically and generally. It is clear that the ordinary people of Africa, the true victims of the illegal diamond trade, will be best served if our Government, rather than accusing the UN of failure, continue to operate in unison with, and in support of, the UN's mission to end the illegal diamond trade. I urge the Minister to work to secure, under a UN mandate, an international certification scheme to cover all rough diamonds. Moreover, I urge him to ensure that the scheme is workable, with minimum standards and compliance, and that it will protect legitimate trade but curtail illicit trafficking in diamonds. That would represent an important step in stamping out illegal diamond trading, with all its unfortunate consequences.

In conclusion, we must put this reprehensible activity into context. Illegal diamond trading amounts to a tiny fraction of the overall legitimate trade in diamonds. Diamonds are beautiful and enduring objects, which have given pleasure to their owners for many hundreds of years, and will continue to do so. Africa has benefited enormously from the trade in diamonds. The diamond mining and selling business should be seen in a holistic context. The difficulties that we have been talking about this afternoon should not stigmatise Africa or encourage any view that the diamond business is somehow tainted. There is no justification whatever for such a view. If the diamond business were perceived to be anything other than a wholly legitimate activity, it would have negative consequences for several African countries, and would neither serve their interests nor those of people in other countries who work in the business, particularly in India. Diamonds have played a crucial part in the development of Africa and must be allowed to continue to do so, supported by consumers all over the world who enjoy, trust and value the product itself.

2.57 pm

Mr. Tony Lloyd (Manchester, Central): I begin by picking up the theme of the hon. Member for West Suffolk (Mr. Spring) that undoubtedly, diamonds are a power for good--the example of Botswana is well made. The benign scenario would be for the whole diamond trade to become something practical and useful, especially for producing countries. It is also a fact that diamonds have altered the course of African history and

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history more generally. At least three conflicts raging in Africa--in Angola, Sierra Leone and the Democratic Republic of Congo--would have been different had diamonds not formed part of the motive for conflict.

There is no doubt that one of the motives for the involvement of many external powers in the conflict in the DRC has been the ability to exploit illegally that country's mineral wealth. In that country, rather than diamonds being employed productively, as in Botswana, diamonds have been stolen and used illegitimately as a mechanism of the conflict. The diamond trade in all three countries can be measured in broken bones and lives lost.

There is no doubt that the biggest mechanism for keeping Mr. Savimbi at the head of UNITA in Angola has been his own ability to control those parts of Angola from which the diamonds come. It might be little recognised in this country that that has been one of the most outrageous conflicts raging on this planet for a long time. Its origins are back in the days of the cold war. That was a long time ago, but, sadly, Mr Savimbi regarded it as a commercial exploitation and an aggrandisement of his own position rather than being about the betterment of the people of Angola.

It is legitimate to question how we handle the diamond trade, and to couple that by saying that we recognise that diamonds are a beneficial commodity that can produce consumer satisfaction in Britain. However, at every part of the chain, those involved must examine their ability to have an impact on those diamonds that have caused such conflicts. I remember when the United Nations first involved itself in the embargo in respect of Angola. At the time, many voices said that it was impossible to control the trade. Those voices came from important Governments that were involved in the diamond trade. They resisted the idea that we should control conflict diamonds because they feared that such action would impact on their own national economies within Europe.

There was resistance within the industry from those who said that it was not possible to control such a trade. Yet, little by little, both the intellectual and the practical arguments, if not being won, are at least moving the margins. It is now possible to say that the control of conflict diamonds is a reality. It is worth examining the report by Global Witness. It recently visited Sierra Leone, a country where the civil administration is extremely weak. I say that as someone with great emotional sympathy for the Government and the people of Sierra Leone.

The institutions are weak, so if Sierra Leone were able, as Global Witness has said, to achieve significant results by the process of certification, it is clear that there is enormous potential benefit for that country and the world. It is not without problems, however, and Global Witness referred to some of the problems that arose in the Sierra Leonean context. It pointed out the capacity for the diamond industry to induce corruption at the most extraordinary levels. Diamonds, by their nature being small and easily transportable, but of enormous value, are an extremely tempting part of the process that leads to the corruption of individual officials.

Dr. Jenny Tonge (Richmond Park): If the Sierra Leone Government can certify some of the diamonds,

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presumably that is a small proportion of the diamonds produced in Sierra Leone. The main diamond fields are still being controlled by the RUF, so presumably diamonds can leave the country without being certified.

Mr. Lloyd : The hon. Lady makes an important point. The problem for Sierra Leone is that, while it can control the diamonds from Government-held areas, as Global Witness said, the process of certification recognises the fact that some diamonds from rebel-held areas come through the legitimate system. It is conceded openly that there are not so many. In general, the system is working, but there is a need to ensure that it works more efficiently. When diamonds are not under the control of the authorities in Sierra Leone, but disappear across the border to Liberia, we must look for the mechanics to which the Minister referred.

There is no doubt that President Taylor of Liberia has been the single most influential person in guaranteeing that the conflict in Sierra Leone continues. Mr. Taylor deserves not only criticism, but the tough action that is long overdue. I know from personal experience that the ability of that regime to claim innocence in such matters is extraordinary, even in the face of the most blatant evidence of abuse. Those diamonds pour across the Sierra Leonean border into Liberia, neighbouring African countries and Europe, and the mechanics are that when diamonds come one way, arms from European countries and others are transferred back to Africa and keep the conflict fuelled. We must do what we can to seal those diamonds, to prevent them from disappearing from Sierra Leone. Let us say it plainly: the people of Sierra Leone are being robbed by the rebels, by President Taylor and by that part of the world community that is prepared to deal in illegal diamonds and the arms trade that fuels the conflict.

However, even in Sierra Leone, where the diamonds are under the control of the Sierra Leonean authorities, the certification process has been successful. We should applaud that, because if it can be done there, there is no argument that we cannot reproduce such certification elsewhere. That is the hopeful message. There are extraordinary difficulties with the diamond trade--diamonds are by nature easily transported and smuggled. No one is under any illusions that even with the most efficient certification process we can guarantee that no diamonds will hit the cutting shops in India or western Europe and that none of them will appear on our high streets. However, we can do a lot to reduce the 4 per cent. of diamonds that have historically come from areas of conflict, and remove the profit element.

I should like to raise a practical issue with the Minister. Global Witness recognised in its report that a limited number of illegitimate diamonds are coming through the legitimate system. One reason given was that if diamond dealers are penalised for including an occasional stone of a questionable but not profitable nature, they will simply continue to smuggle and will not use the new system--or so dealers and their apologists would claim. Global Witness made the point that, in the end, the only way to tackle the problem is by confiscation of illegal diamonds. There must be a tough and robust approach to that; we must examine confiscation as a means of discouragement. Smuggling will take place; I acknowledge that with no joy but enormous regret. However, the way to combat it is not

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to allow the official system to be corrupted at the margin by conflict diamonds. I plead with my hon. Friend to examine that matter.

I welcome the Minister's comments about the steps that the British Government have taken. We have helped to move the issue forward. I also welcome what he said about the possibility of introducing new technology computer links to ensure that the certification process is better managed globally. In the end, countries such as Britain must acknowledge that we are the consumers of diamonds. It is entirely legitimate and acceptable that we consume diamonds from Botswana and South Africa--as the hon. Member for West Suffolk (Mr. Spring) said, no stigma should be attached to that trade. However, equally, we have as much responsibility as anyone else to ensure that we bear down on conflict diamonds. If we ignore that we ignore our moral responsibility and practical capacity to bear down on conflict diamonds in countries such as Congo, Sierra Leone and Angola.

I conclude, Mr. Deputy Speaker, by congratulating the Minister on his remarks, and I encourage him to continue the process, which is not simply worthy but can achieve practical results. I congratulate him on his efforts.

Mr. Peter L. Pike (in the Chair) : Before I call Dr. Tonge, I should say that I am not Mr. Deputy Speaker.

3.9 pm

Dr. Jenny Tonge (Richmond Park): That is modest of you, Mr. Pike. Some of your colleagues are not so modest. We have had a lot of fun in the past few weeks discussing what people should be called and, despite the ruling, some people are getting away with "Mr. Deputy Speaker", which is rather fun.

I am pleased to speak in the debate, because the subject is close to my heart. After four years of considering international development issues, I have realised how important an issue it is. As the Minister said, the great tragedy of Sierra Leone is that some of the poorest people in the world have such great wealth in their country. It goes to the rebels, to Liberia and other countries, and it fuels war, as we have heard, in Angola, Sierra Leone and the Democratic Republic of Congo, for example.

I am delighted that the Cabinet sub-committee on conflict prevention in Africa, an all-departmental sub-committee, is now producing material on conflict prevention. Its interesting report contains a table that lists 35 countries that have experienced civil war since 1948. That is an extraordinary number. Of those wars, six or seven continue.

Diamonds are a big factor in many of the wars that are still running in Africa. I emphasise what a destabilising factor diamonds are and how much suffering they cause. They enable arms to be purchased to pursue such wars. To our great shame, we do not know how many UK citizens are involved in selling arms to such countries, and benefit from the proceeds of illegal trafficking in diamonds, but fortunately we may

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know soon. If the draft arms control Bill is introduced after the general election, as I am sure that it will be, we may subsequently have some control over such people.

In case I do not have the opportunity to say so after the general election, I should say that two aspects of the draft arms control Bill worry me. No mention is made of prior scrutiny, which I thought would be one of the key elements in the Bill, as the Quadripartite Committee so strongly favoured it.

UK passport holders living anywhere in the world who deal in arms should come under the aegis of the Bill, not merely UK passport holders living in Britain. Most of the arms brokers about whom I hear have mobile phones and do not have enormous offices and establishments. They need merely to take their mobile phones abroad to deal in arms paid for out of the proceeds of the diamond industry. I am sorry to digress, Mr. Pike, but I felt that I must put in my oar.

I read a most astonishing document from the United Nations global policy forum, which I hope and expect is being considered by civil servants in the Foreign Office. It was produced on 21 December 2000, and it is the final report of the monitoring mechanism on Angola sanctions. It made staggering reading. I did not read it all, but dipped into it. It contains details of smuggling routes. People know exactly where the diamonds are going and how they are being smuggled. It contains the names of arms brokers, diamond dealers and cutters, and details of where diamonds are cut.

It is common knowledge that, as the report points out, Rwanda and Uganda are big exporters of diamonds. However, they have no diamonds within their country boundaries. A diamond cutting centre in Kigali is planned. I do not know whether it will cut conflict diamonds.

Mr. Tony Lloyd : The crude reality is that no one in Rwanda or Uganda can deny that those diamonds are stolen from the Congo.

Dr. Tonge : I thank the hon. Gentleman for that intervention. I thought as much, because Rwanda and Uganda are always looking for the means by which to buy arms to pursue wars. It could be argued that Rwanda and Uganda have a legitimate interest in defending their territory following the genocide in Rwanda. Nevertheless, conflict diamonds are fuelling wars. I hope that the next time members of the Select Committee visit the Great Lakes region--the hon. Member for Faversham and Mid-Kent (Mr. Rowe) and I were in Rwanda a few years ago--they will investigate the problem in detail.

The other fascinating person in the report is Victor Bout. I am sure that hon. Members know his name. He is all over the place. He is a tremendous chap who has loads of passports and identities. He operates all over the show and is a very successful man when it comes to conflict diamonds. A brief biography of the man tells us that he is married, and that his wife, Alla, resides in the United Arab Emirates. I bet she has some pretty hefty diamonds. I feel like trying to discover the address of the couple. I would love to write to Mrs. Bout and ask her--as a woman, looking at the diamonds that she no doubt wears--how many hundreds of thousands of women and children have been tortured, slaughtered and killed so that she can wear her beautiful diamonds on her finger.

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It is comforting to hear that only 4 per cent. of the diamonds circulating in the world are conflict diamonds, but I have not worn my two very modest diamonds recently. I was given them a long time ago, and I hope that they are not conflict diamonds. Women need to know whether their diamonds are conflict diamonds. It would be nice to find out whether Mrs. Bout knows the suffering that her diamonds probably caused.

I congratulate the authors of the report. It is astonishingly explicit, and I assume that it will form the basis of an awful lot of the certification and monitoring of the subject in the future. I also congratulate the Government on the work that they have done. Dramatic progress has been made, and we thank those responsible for it. I wondered why we were having this debate this afternoon, but it is presumably so that we can record that a lot of progress has been made.

The Kimberley process has resulted in the establishment of the World Diamond Council, which has made huge progress. The need for global certification has been accepted by 189 countries. The only doubts that I have relate to the way in which the council will operate. No doubt we shall find out over the next few years. How will the certification be implemented? Who will check? I feel that faster progress would be made if the United Nations were more effective. It has produced a wonderful report, but how effective will it be at monitoring? For example, in Sierra Leone, as we know, the RUF still controls the diamond fields and until that control is wrested from the rebels--the UN must have a part to play in that--there is little hope of ending the trade in the near future. It would be useful to know whether the Minister shares the view of the Secretary of State for International Development on the role of the UN in Sierra Leone.

A sanctions regime operates against Liberia and Sierra Leone and, according to the Fowler report, there is a lot of sanction busting. Charles Taylor cocks a snook at everyone and carries on regardless, undaunted by sanctions. Where is the monitoring of that? Where are the penalties for breaking sanctions? If we know that sanctions are being broken and who is breaking them, why are there no penalties, and why is the international community so hopeless at penalising people who break the regimes? That is what I find so frustrating.

Conflict in Africa, and all over the world, is not due just to diamonds. I note that the new Cabinet sub-committee on conflict prevention has said that a reduction in the exploitation of mineral wealth is one of the most pressing needs in cutting down the amount of conflict in the world. This morning, I spoke to somebody from Colombia, a country about which the hon. Member for Manchester, Central (Mr. Lloyd) knows a great deal. Wars in Colombia are fuelled by the coca trade, and by gold and oil. In Sudan--which I have visited and about which I feel passionately--the extraction of the mineral wealth of oil is causing untold abuse of human rights and damage to the country. It is also making the civil war in Sudan, which has been raging for 20 years, even worse, because people are being driven from their homelands, taken into slavery and murdered. All that occurs in the name of extracting mineral wealth.

British companies are involved in extracting mineral wealth from southern Sudan, just as British people are involved in conflict diamonds and extracting

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Colombian mineral wealth. I call on the Government to take stronger action against the companies that are prepared to see such suffering for the sake of mineral wealth. Such wealth never benefits the poor people of the country from which it is extracted, but always goes into the hands of the rich of the country, or abroad. More than anything, I hope that we can strive to ensure that British hands are clean.

3.22 pm

Mr. Ian Davidson (Glasgow, Pollok): I congratulate the Minister and the Government on the action that they have taken on the matter. I missed the first couple of minutes of the Minister's speech, but I am sure that it was in line with everything else that he said, which seemed to be first class and worthy of our support. I also congratulate and thank my hon. Friend the Member for Manchester, Central (Mr. Lloyd) for his contribution, and for the contribution that he made to the matter as a Minister.

I want to consider how conflict diamonds may affect legitimate trade. I recently had the opportunity to lead the Commonwealth Parliamentary Association delegation to Botswana, and I saw the tremendous impact that diamond mining and diamond money has had on the country's development. Like the hon. Member for West Suffolk (Mr. Spring), I also received a briefing from the Botswanan high commissioner, so I shall not quote the same words as he did. However, we should not do anything to damage the tremendous impact and difference being made to that country by diamonds and diamond mining. Botswana and other responsible diamond-mining countries welcome the action being taken. However, they are understandably worried that it may spill over and lead to steps that undermine the trade in general, and the source of revenue on which they depend for their development.

I shall touch on, but not go into great detail about, issues relating to Botswana. I have visited its diamond mines and appreciated the way in which the diamonds are produced--they occur in kimberlite pipes. I have seen the mining processes and, from the explanations that we received, I recognise that those diamonds may be physically protected from theft as alluvial diamonds, which are spread over wide geographical areas, cannot. Much to the disappointment of my wife, the diamond production process in Botswana is secure and safe. Even if one looks at the soles of one's shoes after walking through the area, one sees that nothing sticks to them that might be of future use. However, that is not always the case.

I appreciate that it is almost impossible, in Botswana, for illicit diamonds to be smuggled into the trail from the mine to the point of export, but that is not necessarily the case elsewhere. It was difficult to disagree with anything that the Minister said earlier, but not impossible. I want to pick up the point about the security of the trail from mine to shop. I recognise the Minister's point about not wanting to place undue burdens on business, and not wishing to create too much of a bureaucratic nightmare. However, issues of credibility remain. Although the Botswanan process, from mine to the point of export, is secure, that is not the case everywhere else. While there are large numbers of small polishers in India, the opportunity for illicit diamonds to be leaked in to the process and

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contaminate the flow is considerable. I am worried that, in those circumstances, the proposed monitoring process will be insufficiently stringent. The danger is that if the system is deemed to be unsafe or insecure, it will be discredited. If there is failure to convince people that the system is secure, there is a danger of a consumer boycott of diamonds in general--an indiscriminate boycott, which would have tremendous adverse consequences on countries such as Botswana.

While I was in Botswana, I was struck by the impact of HIV-AIDS there. When the group visited a particular mine, we were told that new machinery was to be introduced which would require a work force that was one third smaller. In our naivety, we asked whether there would have to be redundancies. We were told that that would not be necessary, so we asked whether a lot of people would be retiring. It was explained that that was not the case. Eventually, the penny dropped--a third of the work force would die of AIDS over the period during which the new technology was being introduced. Effectively, the work force that was needed would be achieved by a process of attrition through AIDS. The workers in the Botswana diamond mines were, as I understood it, the highest paid and the best educated in the country, and 20 to 25 per cent. of them had tested positive for HIV. Such an impact on a country such as Botswana means that the need for the money flowing from legitimate diamond sales is absolutely essential. Will the Minister provide further assurances about the way in which the trail from mine to shop can be tightened up, secured and made credible, in order to avoid the prospect of an overall consumer boycott, which could significantly damage legitimate producers, such as Botswana, which depend on mining for their future?

3.28 pm

Mr. Andrew Rowe (Faversham and Mid-Kent): The debate highlights a considerable and welcome shift in the world perception of what is acceptable behaviour. Our democracy is old enough for us to have been enriched by piracy against Spanish ships that were engaged in carrying gold that they had stolen from south America. We are old enough to have been enriched by the slave trade for a couple of centuries, and we have benefited hugely over the years, whether through the inclusion of the Kohinoor diamond in the Queen's jewels or taking mineral deposits from countries that were not strong enough to stop us. We must therefore approach the subject with humility.

Importantly, the world is at last beginning to understand the clear gain to the global community of having higher and enforceable standards. That is a huge improvement. Yesterday, I sat through a large part of the Quadripartite Committee's proceedings on arms control, and I was encouraged to discover that the arms industry is generally in favour of proper controls on arms dealing. Its sole and understandable anxiety is that it might be left so far ahead of the pack that less scrupulous countries could benefit at its expense. That is the reason why international agreements, such as the Kimberley agreement, are indispensible for serious progress.

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With regard to the matter under discussion, we should carefully examine our foreign and development policies. I am disheartened by events in Uganda. It has made a serious attempt to deal with HIV and AIDS, and to improve the living conditions of its people, but it also takes too readily to armed conflict to achieve its ends. Some of Uganda's armed conflicts are as historically difficult to unravel as the Northern Ireland situation, but others are almost gratuitous. Uganda is illegally plundering the Democratic Republic of Congo's mineral wealth, and yet it remains the darling of the development community. For instance, it was one of the first countries to receive heavily indebted poor countries relief. We must support countries in sub-Saharan Africa that have Governments that are strong and committed enough to make a positive difference, but we should also use our position to put pressure on nations such as Uganda to behave better.

The policy of certifying the origins of diamonds should be developed as far as possible, because it is clear that legitimate producers, such as Botswana, have everything to gain and nothing to lose from such a transparent international system. I was encouraged by the Minister's comments about the roles of Great Britain and the international community with regard to the issue, and I hope that a system of transparent certification and of monitoring the routes by which diamonds get into the shops, and on to the bosoms of arms dealers' wives, can be properly put in place. I trust that, as the international community develops and globalisation advances, we will be better able to differentiate between regimes whose behaviour is unacceptable to the international community, and those that are making a serious effort to match up to international standards.

The narrow issue that we are debating has wider implications, but I do not wish the discussion to be broadened to such an extent that effective action is not taken.

3.34 pm

Mr. Wilson : With the leave of the Chamber, Mr. Pike, I shall reply to the debate. The opening remarks of the hon. Member for Faversham and Mid-Kent (Mr. Rowe) were important. It is a great advance that we are discussing the source of a commodity and the conditions under which it is produced, and the implications of those matters. Such scrutiny should be applied to many other commodities. We are entitled to ask those who benefit from the production of such commodities to offer some assurances about their source and its ethical quality.

To digress slightly, I have been involved a little in the past week or 10 days with the question of how cocoa is produced. I did not know that child slaves were used to anything like the extent that they appear to be in the production of cocoa and other basic commodities in parts of Africa. However, now that I do, I have no doubt that it should be possible to walk into a supermarket in this country to buy chocolate or cocoa and to have an assurance from the people who have made it and profited from it for generations that each of the ingredients was produced under circumstances that consumers find acceptable. That is not too high a standard to set, and there is nothing technically impossible about giving such an assurance. If there are

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difficulties, it is up to the people who profit from the supply chain to address them and thereby put themselves in a position to give an assurance.

The implications of what we are talking about go beyond diamonds, although there is a special consideration in the case of diamonds because there is a straight correlation in practice between illegal production and the illegal acquisition of weapons of death. That makes the imperatives behind the action in which we are participating so urgent and the moral arguments so unanswerable. The diamond industry has therefore been put in the forefront when it comes to facing demands for a response to ethical questions and for the assurances that we all want. The industry has been obliged to lead the way today, but many other producers of basic commodities, in line with the philosophical change that has been identified, will be asked to act tomorrow. It will be a great step forward for humanity when they are.

Dr. Tonge : What assurances will the Minister seek from the chocolate manufacturers? I understand that the Government have had some contact with them. What assurances will we get that their products do not involve child slave labour? Will those assurances be on the product?

Mr. Wilson : I seek your further indulgence, Mr. Pike, to answer that point briefly. We are in discussion with the chocolate manufacturers and cocoa producers, and there will be further meetings in the near future. In fact, I signed a written reply to the hon. Lady to that effect today.

Nobody wants to generalise or sensationalise or to suggest that every bar of chocolate or cup of cocoa has the blood of slave children in it. It is tempting to leap from the particular to the general in that way, but we do not want to over-dramatise. I want to be able to give the assurances that the hon. Lady suggested. It should be possible to secure the involvement of the producers in the industry in the same way as it has been possible to engage the producers in the diamond industry.

As I said in my opening remarks, the story so far is a positive one of Governments, industry and civil society working together to achieve the same ends. However, I still do not underestimate the difficulties of reaching agreement on a global certification scheme for rough diamonds. The concept might be reasonably simple, but delegates who attended the Kimberley process meetings have a lot of technical details to agree between now and the autumn. Those include the point raised by my hon. Friend the Member for Glasgow, Govan about how national and international customs procedures for the import and export of diamonds can be adapted in such a way as to give the assurance of legitimacy that we seek. It is obviously necessary to find mechanisms that do not give rise to the fantastic paper trail that could come into existence if every stage of the chain required certification, but which do not reduce the system to something that is meaningless because it is too vague. That is something that Governments alone cannot enforce--we must have the co-operation of the industry, which is why the Kimberley dialogue is taking place in Brussels this week.

Mr. Davidson : I would like to point out that the Minister's hon. Friend from Govan is actually his hon. Friend from Pollok.

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However, I seek an assurance that any system that is developed will be open to modification and that the Government intend to press the industry to agree in principle that where any difficulties or discrepancies arise there will be some way of amending the procedure. We would not want to establish a system that could not be amended even if it was discovered to be fallible.

Mr. Wilson : That is self-evidently true, and I note what my hon. Friend the Member for Glasgow, Pollok (Mr. Davidson) says. I must remember in future that when we are talking shipbuilding he is from Govan, but when we are talking diamonds he is from Pollok. That is now established beyond doubt.

The issues under discussion as part of the Kimberley process include whether we can agree on simple but effective monitoring mechanisms that do not breach commercial confidentiality. Many producer countries are naturally sensitive about data relating to their diamond trade and possible stockpiles. They also want to preserve their own systems of certification and authenticating diamonds without undue interference from outside.

As part of the Kimberley process, we also need to consider whether any scheme will be voluntary or mandatory, whether it will apply globally or regionally, and whether it will be compatible with other international legal agreements governing trade, such as those imposed by the World Trade Organisation. These issues and others have to be discussed, but I am confident that with sufficient political will they can be satisfactorily resolved. I hope that no nation will want to frustrate agreement on an issue so important to the welfare of so many people throughout the world.

I will now try to deal with some of the points raised this afternoon. The hon. Member for Richmond Park (Dr. Tonge) wondered aloud how many British citizens were involved in selling arms to rebel groups such as UNITA and the RUF in Sierra Leone, which is very much part and parcel of today's debate. By definition, I cannot answer that question. However, I can say that anyone who is involved in that activity is acting illegally. Both of those organisations are the subject of United Nations embargoes. Anyone who is involved in that trade is liable to arrest and prosecution. Any available information about any British citizen who is involved in that trade, whether in Britain or abroad, should be brought to the attention of the authorities. I can assure the hon. Lady that such information will be diligently followed up.

I would also like to endorse the remarks of my hon. Friend the Member for Pollok about the negative effects of any boycott initiative in allowing the legitimate trade to become tainted by the illegitimate trade. There are probably lots of people in the western world who do not like the concept of diamonds in general because they do not have any, and if they can dress up that dislike in an ethical argument, so much the better for them. We should not subscribe to a boycott in any way, for exactly the reason given by my hon. Friend.

Diamonds are an extremely valuable and important commodity for many countries the economic activities of which we generally endorse and support. For the UK to be in any way party to a boycott or a discrediting of those countries' basic raw material, which contributes to

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their wealth, would be irresponsible. That point must be clearly made, because the argument in favour of a boycott arises from time to time. Although it is glib and partial, it is a solution in the eyes of some, but it is not one that we support, because it would have consequences for the people who produce the 96 per cent. and more of diamonds that are legally mined and refined. My hon. Friend the Member for Pollok is right; Botswana and the other diamond-producing countries are entitled to receive that message clearly from this debate. I would even suggest that the hon. Member for Richmond Park uncover the stock of diamonds in her bijou residence in Richmond and wear them with pride, safe in the knowledge that it is 96 per cent. certain that they were legitimately produced. [Interruption.] She is now trying to tell the Chamber that they are very small diamonds. We shall wait and see.

In cash terms, there are few objects on earth more valuable than a diamond. However, the nub of the problem is that the value of each diamond that is smuggled out of a conflict zone is great enough for thousands of bullets to be smuggled in. Nothing can be easier than carrying a diamond over a border, but cutting out the scourge of conflict diamonds from the world diamond trade is a much greater challenge. To

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achieve that, it is essential that all Governments with a direct stake in the diamond business buy into any agreed international solution. It is vital that the industry--the hon. Member for West Suffolk (Mr. Spring) rightly mentioned de Beers--as well as civil society, representatives of trades unions and NGOs, have all been involved at every stage of the Kimberley process.

We have on our side the good will of all the major stakeholders. While that makes it easier to devise a solution, we still need imagination and determination on the part of everybody. Many details remain to be resolved and there are many interests at stake. The next stages of the process may well be painstaking. However, I can say with certainty that we shall gain nothing by going ahead without having the industry on board. Equally, there is no point if we do not involve civil society. We are aware that any final scheme must strike a delicate balance between practicality and bureaucracy. We shall work hard to find that balance, while trying to maintain the momentum built up over the past year. I hope that in future months, as the Kimberley process develops, I will be able to report on the progress that we have made in ensuring that the legitimate diamond industry is untainted by conflict.

Question put and agreed to.

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