Sierra Leone

"Peace diamonds" from Sierra Leone

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The recently formed Kono Peace Diamond Alliance organized by USAID offers hope of changing the image of diamonds once used to fuel a brutal war to those that are now being used to benefit local communities.
The two-day launch of the Kono Peace Diamond Alliance, funded by the new USAID Global Development Alliance and organized by USAID staff in Sierra Leone, was held in Koidu Town, in the heart of Kono District's diamond mining region, December 18-19, 2002. The overall objective of the Kono Peace Diamond Alliance is to improve the management capacity of Sierra Leone's diamond resources and to ensure that more benefits from the mining and sale of diamonds flow back to local communities. It is also an attempt to prove to Sierra Leoneans and the world that words often associated with Sierra Leone's diamond industry in the past--exploitation, corruption, abuse, and conflict--do not necessarily have to be features of its future.

Accomplishing that difficult goal requires the combined efforts of private and public sector actors, as well as the involvement of local communities and watchdog agencies. Management Systems International (MSI) USAID's implementing partner, marshaled more than 80 national and international attendees who used the meeting time to identify key constraints and possible solutions to problems that are currently associated with diamond activity. The problems identified included: too few benefits obtained from diamond resources at local levels, exploitation of labor, and illegal export (smuggling). In order to ensure that action be taken, each organization represented was asked to announce what they would do to address the identified problems.

Commitments to Action

To avoid "all talk and no action," a representative of each participating organization was asked to come forward and state what their organization would commit to doing to address any of the operational objectives.

Local, Kono-based organizations (youth, mining and dealers organizations) pledged to establish a dealers cooperative; establish an information outreach hub to ensure that community input reaches the Alliance and that important information reaches every village; monitor the security of genuine and competent investors; assist in monitoring legal and illegal diamond dealings; engage in environmental programs for reclaiming and preparing mined-out land for agriculture; and develop a campaign to encourage children to attend school rather than work in the mine pits.

The Government of Sierra Leone (GOSL)'s Ministry of Mineral Resources promised to continue and improve the operation of the Diamond Area Community Development Fund, and to work in concert with the Alliance members to improve mining-sector policies. The Anti-Corruption Commission committed to launching a massive awareness program on civil corruption, monitor the flows of royalties and fees, visit Kono more frequently and investigate opening a branch office in Koidu; and to pursue and follow up on any corruption charges against Alliance members.DeBeers, Rappaport, and Branch Energy were the major representatives of the international private sector in attendance.

DeBeers pledged to train additional Sierra Leoneans to become official valuers for the GOSL's Government Gold and Diamond Office; to provide the GOSL with geological information from their archives; and to work closely with USAID, DfID (the overseas donor agency of the United Kingdom) and the GOSL in the provision of other DeBeers personnel to build knowledge and skills among regulators, dealers and miners alike. Rappaport stated that it would establish buying cooperative networks in Kono; train the cooperatives' members; and establish fair trade diamond mining facilities in Kono. Branch Energy committed to developing agriculture in Kono as a complement to diamond mining, in particular, to financing the training of local people in agriculture skills.

An American/Sierra Leonean company whose partners include a Sierra Leonean (originally from Kono) professor who teaches at Prince George's Community College in Maryland and several chiefs/communities from Kono showed strong interest in the objectives of the Alliance and pledged to support in whatever way it could to the achievement of the objective.

Finally, two donors were in attendance at the Alliance launch: USAID and DfID. USAID committed to providing technical assistance and equipment to the Ministry of Mineral Resources. In working through its partners, USAID also committed to: accessing improved technology, such as GIS mapping capacity; strengthening the capacity of interested CBOs in Kono; conducting feasibility work for a credit scheme; commissioning further analysis of the economics and financial flows in Sierra Leone's diamond industry; and providing organizational support to the Kono Peace Diamond Alliance.

Many non-governmental organizations (NGOs) active in the area have also made commitments. For example, USAID-sponsored Catholic Relief Services intends to help chiefdoms organize transparent decision forums for deciding what to do with their portion of the proceeds from the Diamond Area Community Development Fund.

DfID committed to supporting a mining policy specialist; funding the Sierra Leone Broadcast Service; disseminating technical information; and constructing the joint USAID/DfID project office in Koidu. Jointly, USAID and DfID plan to conduct a major mining policy workshop in March, 2003.

In the final working session, a Diamond Alliance Planning Task Force (DAPTF) comprised of up to one member from each organization was formed to help move the process forward by developing a governance strategy, a code of conduct and a work plan for the Alliance. All items suggested by the Task Force are to be referred to the full Alliance membership for comment, amendment, and approval at the next meeting of the Alliance. The Task Force is expected to complete its recommendations to the Alliance within three months, at which time USAID partner MSI plans to organize and facilitate the follow-up meeting.

The Alliance as a First Step...

Through USAID's Democracy and Governance programs, progress has been made on improving diamond-sector management by assisting the GOSL and local communities in monitoring the mining sector. For the first time, USAID technical assistance and policy dialogue made it possible for local diamond mining communities to receive direct financial benefits in proportion to the legal mining taking place within their chiefdoms. In 2002, legal exports increased by nearly 50% from $25 million to $37 million, and proceeds to mining communities nearly doubled from about $145,000 to $280,000. For this activity, the challenge will be to contain corruption, and nurture well-meaning and dedicated stakeholders from both the public and private sector to continue the positive momentum. The objective of the Kono Peace Diamond Alliance, which pilots best practices, aims to do just that.

The enormity of the task the Alliance faces, however, cannot be understated. Those benefiting from the current scheme of business in the area are not likely to favor changes. In addition, Kono District--the major diamond-mining area in Sierra Leone--and Koidu town in particular have incurred near-total destruction during the war and must be rebuilt. As local communities see revenue flow back into the community from the diamond industry, they can begin rebuilding local infrastructure. Confidence and trust come with time, and the Alliance has recognized that local residents need to feel that they are both benefiting from and have a stake in the development of the local diamond industry.

One of the most vital accomplishments of the workshop was having the participants-representing private sector, public sector, grassroots organizations, local leaders, and donors-speak face to face and understand that they are all in favor of improving the management of the diamond sector. The two-day workshop also helped improve the knowledge base of many of the participants, and also advanced a common goal--helping local communities in Sierra Leone benefit from their own precious resources. In a country in which a brutal war is now spoken of in the past tense, the Alliance hopes to introduce "peace diamonds" from Sierra Leone to the rest of the world.

The Kono Peace Diamond Alliance Diamond industry issues identified:

1) Mining policy has been overly centralized, thereby marginalizing communities and removing any sense that people on the local level have a stake in legal mining and marketing;

2) Even if policies were good, the GOSL has lacked the resources to implement them;

3) People at the community level have lacked information on relevant policies, laws and resources, which has allowed them to be duped by others claiming to have this information;

4) Lack of start-up capital has left indigenous Sierra Leoneans with few options other than entering into exploitative relationships reminiscent to share-cropping - only worse since the "supporters" who finance their operations almost always require the miners to sell their stones to them at non-negotiable prices;

5) There is very little competition in the diamond-buying market and buying shops are said to collude to keep prices artificially low; and, certainly not least,

6) Corruption.

Desired Results:

  • Improved GOSL systems in regulating trade in legal diamonds (ex: improving quality of tracking purchases and inspection practices, denouncing corruption and non-disclosure, ensuring benefits to diamond-mining communities) and incentives to use those systems

  • Active civil society that supports improved state and community diamond management

  • Improved community diamond management systems and incentives to use them effectively

  • Improved enabling environment characterized by more transparency, competition, and responsiveness to diamond-mining communities

  • Working capital available to indigenous miners

  • Improved working relationships between GOSL, traditional leaders, business, civil society, and communities

  • Better information available on policies, regulations and laws in the diamond sector

  • Better working conditions and environmental management

  • Livelihood alternatives to mining available