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replaced. This is just one example of the chaos that could ensue when good and honest folks make a sincere effort at CARAT Act compliance.

Small gemologist and appraisal practitioners will not be able to avoid being dragged into the fray either. Once this snowball starts to roll there will invariably be consumers asking us to confirm that their diamonds are from the country represented at point of sale. We will not have the ability to do so and confusion will reign supreme as fodder for media expose sensationalists always on the hunt for a good story or some free publicity.

It seems to make much more sense, and seems more practical and efficient to nip the whole thing in the bud at the source. If current industry proposals can succeed in sealing and certifying rough diamonds before leaving their country of origin then we could all know from that point on that those diamonds, the overwhelming majority of diamonds mined, are ŌK wherever they then go. We urge Congress to avoid precipitous action and allow the international trade leadership reasonable time to develop, foster and implement such procedures.

For the Gems & Jewelry Reference and the Appraisers' Information
NetWork, thanks for taking the time to consider our comments.

L

EMBASSY OF THE REPUBLIC OF LIBERIA

WASHINGTON, DC

September 12, 2000

The Honorable Philip Crane

Chairman, Subcommittee on Trade
House Ways and Means Committee
1104 Longworth House Office Building
Washington, D.C. 20515

Dear Mr. Chairman:

I have the honor to first thank the Subcommittee for the opportunity to submit a statement on behalf of the Government of Liberia on the issue of conflict diamonds. The issue is critical to our neighbor, Sierra Leone, but it is also of vital importance to my country, also a diamond producer.

I am attaching to my statement a copy of a letter written on August 28, 2000_to United Nations Secretary General, Mr. Kofi Annan, by the President of Liberia, Dr. Charles Ghankay Taylor. A similar letter was also sent to President William Jefferson Clinton. In both letters, President Taylor re-affirms Liberia's unreserved support for Security Council resolution 1300 (2000) which calls, inter alia, for an end to the smuggling of diamonds from Sierra Leone. In addition to our support for the UN resolution, Liberia recently undertook several new initiatives to assist in the international battle against conflict diamonds and the dangerous purposes for which they are traded-namely, arms to fuel civil conflicts in Africa.

We have enacted a statute criminalizing the export of undocumented or uncertified diamonds. We have undertaken the enforcement of legislation requiring the Central Bank of Liberia to issue certificates or origin for Liberian diamonds. We have asked the International Monetary Fund and the World Bank to provide experts who would assist in the development of a transparent certification process. Further, we have called for assistance from the international community to urgently convene a meeting of international experts to focus on the trade and certification process in the Mano River Union Countries (Liberia, Sierra Leone and Guinea).

Liberia has taken these steps not only out of concern for the peace and stability of the region, but also to ensure our territorial integrity as well as the security of our citizens. Liberians are no less impacted by the illegal diamond trade than our neighbors and have the same interests in seeing it halted as the rest of the international community.

Mr. Chairman, I appreciate the opportunity to provide this information that I trust will assist your committee in its deliberations. If I can answer any questions regarding Liberia's views, please do not hesitate to contact me.

Please accept, Mr. Chairman, the renewed assurances of my highest consideration.

Sincerely,

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Attachment:

Letter from the President of Liberia to the United Nations Secretary General contained in UN Security Council

I extend compliments on behalf of the people of Liberia and in my own name to you on the occasion of the convocation of the Millennium Summit, where leaders of the world would be expected to define problems besetting our global family and determine solutions the alleviation of those problems, engendering hope in the future of our one world and carving new aspirations for the United Nations. Against this background, I am pleased to acquaint you with the current status of Liberia's engagement in Sierra Leone, a troubled portion of our global village.

You may recall the commitment of the Government of Liberia to remain constructively engaged in the resolution of the crisis in the sisterly country of Sierra Leone. Recently, our involvement, among other things, culminated in the release of over 500 United Nations peacekeepers who were unfortunately held against their will by the Revolutionary United Front (RUF). Our Government will continue to be steadfastly bound to an immediate, peaceful and diplomatic solution to the crisis in the subregion, and will continue to offer public and practical expressions to these endeavours.

However, the apparent silence of the international community to the repeated violations of our territorial integrity by armed insurgents from the area of the GuineaSierra Leone borders, including a third and most recent attack emanating from the Republic of Guinea, which is ongoing, continues to overburden the Liberian Government with unnecessary loss of lives and property and the displacement of a large number of our people. It is the request of the Government of Liberia that you utilize all forms of influence at your disposal to ensure the sanctity of our borders and the maintenance of peace, security and stability within the framework of the Mano River Union.

As the inviolability of the borders between Liberia Guinea and Sierra Leone remains a crucial issue, I recommend the following and request the support of the United Nations in ensuring their speedy implementation:

(a) The Government of Liberia again calls for a monitoring presence of the United Nations at these borders to monitor all crossing points capable of conveying vehicular traffic. We recognize the enormous cost to individual nations of policing the entire length of these borders and suggest the utilization of an airborne multi-spectral service in detection of any unusual movements along the entire border.

Intelligence gathered therefrom could be shared by all appropriate authorities. The cost, which is relatively minor, could be borne by the international community;

(b) On the status of RUF, as has been previously done, the Liberian Government has again called for the immediate disarmament and simultaneous deployment of troops from the Economic Community of West African States (ECOWAS) under the United Nations Mission in Sierra Leone (UNAMSIL) in areas recently considered as RUF-dominated.

Along these lines, RUF has announced a new leadership acceptable to ECOWAS and has informed EDOWAS through its Chairman that it welcomes our call for disarmament and demobilization and that it has begun the process leading to the transformation to a political entity and subsequent reintegration into society. Additionally, RUF has informed ECOWAS of its wish to return weapons retrieved from United Nations peacekeepers and its desire to establish communication with the High Command of UNAMSIL, to facilitate and accelerate the return of the weapons and the process of confidence-building.

In keeping therewith, it is our recommendation that these initiatives be immediately exploited by the United Nations, leading to a ceasefire; the withdrawal of all belligerent forces to positions as at 7 July 1999; the simultaneous deployment of ECOWAS troops, under UNAMSIL; and the total disarmament and demobilization of the armed factions.

You are doubtlessly aware of our unreserved support for Security Council resolution 1306 (2000), calling for an end to the smuggle of diamonds from Sierra Leone. As evidence of this, we are undertaking several initiatives, including the enactment of a statute criminalizing the export of undocumented or uncertificated diamonds; the enforcement of legislation requiring the Central Bank of Liberia to issue certificates of origin; and our request to the International Monetary Fund and the World Bank to second experts who would assist in the development of a transparent process. Furthermore, the Government calls for assistance from the international com

munity to convene a meeting of international experts to focus on the trade and certification process in the Mano River Union countries.

The Government of Liberia assures you of its continued commitment to the pursuit of peace and stability both at home and in the subregion and welcomes the convening of this Summit with hope and anticipation for the evolution of solutions that will make our world a safer place for our children.

Finally, I wish to request that you kindly circulate the present letter to all members of the Security Council as a document of the Council.

DAHKPANNAH DR. CHARLES GHANKAY TAYLOR

DIAMOND DEALERS CLUB, INC.
NEW YORK, NEW YORK
September 19, 2000

Congressman Philip M. Crane, Chairman

Subcommittee on Trade

House Committee on Ways and Means
Longworth House Office Building

Washington, D.C.

Dear Congressman Crane,

I am pleased to have the opportunity to offer our comments regarding the hearing on trade in African diamonds convened by the Subcommittee on Trade of the Committee on Ways and Means that was held on September 13, 2000.

The Diamond Dealers Club is a trade association of diamond dealers, brokers and manufacturers established in 1931. Since the founding of our organization, we have been located in New York City. Our nearly 2,000 members come from more than 30 different countries and are importers of the overwhelming percentage of diamonds that enter the United States. Our By-Laws embody our founders recognition of our organization's key goal "to cooperate with governmental agencies." The following comments are presented with this goal in mind.

As mutilations of civilians and severe civil rights violations occurring in certain civil wars in Africa became more frequent, we became increasingly appalled. Particularly alarming to the diamond industry was the news that diamonds, which enter the world diamond market from these countries, are responsible for these violations and are used to finance civil wars. Therefore, beginning in 1999, we devoted considerable attention to resolving the problem of conflict diamonds. We have met and worked with members of the U.S. Congress, representatives of foreign governments and industry leaders to come up with an effective solution to this problem. Our commitment to eliminating the sale of conflict diamonds is evident. Our membership-elected Board of Directors adopted the following resolution to battle the sale of conflict diamonds: "Dealing in conflict diamonds shall constitute conduct unbecoming of a member for which suspension shall be instituted."

The Diamond Dealers Club supports the resolution adopted by the World Diamond Congress on July 19, 2000. We believe that the effective implementation of this proposal would go a long way towards eliminating the problem of conflict diamonds and their use to purchase arms and finance civil wars.

Clearly, the WFDB proposals would benefit both the diamond-producing nations as well as the American industry. Their strict implementation would mean that instead of diamonds being used to finance the death and destruction of innocent civilians, they would provide as they have in such countries as South Africa and Botswana-employment for tens of thousands of Africans as well as encourage economic development in diamond-producing nations.

Concomitantly, we feel that proposals that could lead to a boycott of diamonds would be harmful to the entire diamond industry. This includes the miners and governments in the producing nations that have benefited from these resources as well as the small business dominated diamond industry in several countries including the United States.

We hope that the Subcommittee finds these comments useful in its deliberations on the subject of trade in African diamonds. We look forward to working with you to resolve the problem of conflict diamonds. If you have any requests for additional information from the Diamond Dealers Club, please do not hesitate to contact us.

Sincerely,

S

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Statement of Mary Diaz, Executive Director, Women's Commission for Refugee Women and Children, New York, New York

The Women's Commission for Refugee Women and Children is an expert resource and advocacy organization working to improve conditions for refugee women and children around the world. The Women's Commission has sponsored several fact finding missions in West Africa, including Sierra Leone, Liberia and Angola over the past five years and released a report assessing the protection and assistance needs of Sierra Leonean children and adolescents. As part of a campaign to monitor the situation in Sierra Leone, the Women's Commission has supported local women's organizations, who are working to rebuild their country.

THE FOLLOWING QUESTION AND ANSWER PIECE WAS INITIALLY PREPARED TO RAISE AWARENESS AMONG CONSUMERS ABOUT THE PROBLEM OF CONFLICT DIAMONDS AND TO PROMOTE POSSIBLE SOLUTIONS.

Diamonds: Symbols of Love or War?

Questions and Answers

1. Why should I be concerned about diamonds?

Diamonds from Sierra Leone, Angola, and the Democratic Republic of the Congo have been used by rebel groups to purchase weapons and commit unspeakable atrocities against civilian populations. In Sierra Leone, with the aim of conquering diamond-rich areas and securing the mines for themselves, rebels have used machetes to brutally chop off the limbs of women, children, and even babies. They have forcibly recruited and drugged child soldiers. They have also abducted thousands of women and young girls as sex slaves who are often beaten and gang-raped. This violence has displaced almost a million people within Sierra Leone, created 460,000 refugees in neighboring countries and abroad, and left thousands of children disabled by dismemberment and mutilation. American consumers buy about 65 percent of diamonds worldwide, and while diamonds are usually regarded as symbols of love and commitment, diamonds mined from conflict areas are actually a source of hor

ror.

2. How can the United States play a leadership role in stopping diamond fueled conflict?

The US can play a leadership role by enacting the Consumer Access to a Responsible Accounting of Trade (CARAT) Act. Currently, there is no way of guaranteeing where diamonds sold in the US, or anywhere else in the world, originate. The CARAT Act would require the diamond industry to provide US consumers with information about whether a diamond for sale originated from a conflict area. The Consumer Access to a Responsible Accounting of Trade Act, otherwise known as the CARAT Act (HR 3188) was introduced by Congressman Tony Hall (D-OH) and Congressman Frank Wolf (R-VA) in November of 1999. A revised version will be introduced this September. This bipartisan legislation acknowledges that some diamonds fuel Africa's wars and seeks to give Americans crucial information about the diamonds they buy.

3. What are conflict diamonds?

Conflict diamonds are diamonds mined or stolen by rebel forces who are fighting the legitimate and internationally recognized government of that country. Currently, these conflict diamonds are mined in Sierra Leone, Angola, and the Democratic Republic of the Congo. They are often smuggled out of these countries and into neighboring countries such as Liberia and the Ivory Coast. The latter have negligible diamond resources themselves but sell millions of US dollars worth of diamonds to trade centers around the world. Liberia's illicit diamond trade is widely recognized by diamond industry experts; to illustrate, Liberian diamond mining capacity is only about 100,000 to 150,000 carats per year but the country has exported over six million carats annually.

4. Can the American consumer help break the cycle of violence in the illegal diamond trade?

Yes. The Women's Commission has joined a broad based coalition of non-governmental and humanitarian assistance organizations that are committed to educating consumers about the illegal diamond trade and providing information that will allow

consumers to make informed diamond purchases. Independent diamond experts have estimated that about 10-15 percent of the world's supply of diamonds are from conflict areas in Africa. Although this is a relatively small percentage of the overall diamond market, it is significant because the diamonds from these conflict countries are largely gem quality diamonds. Gem quality diamonds are the most valuable portion of the diamond market and constitute 75 percent of the diamond profit. Because rebels are able to sell diamonds throughout the world at a large profit, they are able to sustain the wars in these countries. Therefore, it is imperative that consumers know where their diamonds are from in order to make informed purchasing decisions and eliminate these conflict diamonds from the market.

5. Are all diamonds from conflict areas?

No. In fact, diamonds from Africa can have a very positive effect on those countries with legitimate diamond industries and cutting centers. In Botswana, Namibia, and South Africa, the diamond industry has bolstered the economies, making them among the most prosperous and stable countries in Africa. Diamond cutting centers in India and Israel employ large numbers of people. If you buy a diamond from these areas, you will actually be supporting a vital industry. We are not advocating for a total boycott of diamonds because this would prove detrimental to these vital legitimate industries. Rather, informed consumers can do the responsible thing by buying legitimate diamonds and avoiding conflict diamonds.

6. What can be done to end the trade in conflict diamonds?

• Support the CARAT Act (HR 3188) that would provide consumers with information about where their diamonds originate;

• Educate consumers about diamonds that fuel Africa's wars, such as those from Sierra Leone, and those from legitimate diamond industries, such as Botswana;

• Demand that every diamond be accompanied by full forgery-proof documentation of the country of origin, not just the place of purchase or export;

• Support government regulation to bring transparency to diamond transactions such as through Customs offices that employ statistical procedures to identify the number of carats exported from a particular country and ensure that the export number is consistent with that country's mining capacity;

• Support technology for diamond "fingerprinting" to reliably determine the origin of diamonds.

This research was compiled based in part on information from the following sources: Ashton, Hilton. "Technical Forum on the Issue of "Conflict Diamonds," summary by BoE Securities of "Conflict Diamonds-Maintaining Consumer Confidence,” forum held May 11-12, 2000 in Kimberley, South Africa. May 25, 2000.

De Beers Mining Company. "De Beers: U.S. Congressional Hearings," Written testimony before the US Congress, House Subcommittee on Africa, hearing on "Conflict Diamonds." May 9, 2000.

Global Witness. "Conflict Diamonds: Possibilities for the Identification, Certification, and Control of Diamonds." May 10, 2000.

Harden, Blaine. "Africa's Gems: Warfare's Best Friend." The New York Times on the Web, April 6, 2000.

Rapaport, Martin. "Guilt Trip." April 7, 2000. Available at www.diamonds.net Smillie, Ian, Lansana Gberie and Ralph Hazleton. "The Heart of the Matter: Sierra Leone, Diamonds, and Human Security.” Partnership Africa Canada, January 2000.

Other useful sources:

Collier, Paul. "Economic Causes of Civil Conflict and their Implications for Policy." World Bank. June 15, 2000.

Fowler, Robert R. "Report of the Panel of Experts on Violations of Security Council Sanctions Against UNITA." Report to the United Nations Security Council. March 10, 2000.

Global Witness. “A Crude Awakening: The Role of the Oil and Banking Industries in Angola's Civil War and the Plunder of State Assets." January 2000.

Global Witness. “A Rough Trade: The Role of Companies and Governments in the Angolan Conflict." December 1998.

Kempster, Norman. "Dripping in Diamonds-and Blood." Los Angeles Times. May 12, 2000.

National Intelligence Council. “Africa: The Economics of Insurgency in Angola, the Democratic Republic of the Congo, and Sierra Leone." Report from State Department conference on October 5, 1999. October 1999.

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