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The Heart of the Matter THE HEART OF THE MATTER SIERRA LEONE, DIAMONDS & HUMAN SECURITY (COMPLETE REPORT) Ian Smillie Lansana Gberie Ralph Hazleton Partnership Africa Canada (PAC) is a coalition of Canadian and African organizations that work in partnership to promote sustainable human development policies that benefit African and Canadian societies. The Insights series seeks to deepen understanding of current issues affecting African development. The series is edited by Bernard Taylor. The Heart of the Matter: Sierra Leone, Diamonds and Human Security (Complete Report) Ian Smillie, Lansana Gberie, Ralph Hazleton ISBN 0-9686270-4-8 © Partnership Africa Canada, January 2000 Partnership Africa Canada 323 Chapel St., Ottawa, Ontario, Canada K1N 7Z2 [email protected] P.O. Box 60233, Addis Ababa, Ethiopia pac@ telecom.net.et ________________ The Authors Ian Smillie, an Ottawa-based consultant, has 30 years of international development experience, as manager, programmer, evaluator and writer. He was a founder of the Canadian NGO Inter Pares, and was Executive Director of CUSO from 1979 to 1983. His most recent publications include The Alms Bazaar: Altruism Under Fire; Non Profit Organizations and International Development (IT Publications, London, 1995) and Stakeholders: Government-NGO Partnerships for International Development (ed. With Henny Helmich, Earthscan, London, 1999). Since 1997 he has worked as an associate with the Thomas J. Watson Jr. Institute at Brown University on issues relating to humanitarianism and war. Ian Smillie started his international work in 1967 as a teacher in Koidu, the centre of Sierra Leone’s diamond mining area. Lansana Gberie is a doctoral student at the University of Toronto and research associate at the Laurier Centre for Military, Strategic and Disarmament Studies, Waterloo, Ontario. He worked as an investigative journalist in Sierra Leone between 1990 and 1996, and has studied journalism in the United States, including a period of time with the Kansas City Star. He has written extensively on Sierra Leonean history and politics. His 1997 Master’s Thesis (Wilfrid Laurier University) was entitled “War and Collapse: The Case of Sierra Leone”. Ralph Hazleton holds a PhD in economics. He has 25 years of experience divided equally between Canadian academia, where he has worked as a political economist, and Africa, where he has worked as a senior manager of development and emergency efforts in Zaire, Zambia, Tanzania, Rwanda, and more recently, in Liberia and Sierra Leone. He was awarded the Meritorious Service Medal by the Government of Canada for his work with Rwandan refugees in Zaire in 1994-5. ii/ SIERRA LEONE, DIAMONDS AND HUMAN SECURITY TABLE OF CONTENTS Table of Contents Acronyms Foreword Preface Executive Summary 1. INTRODUCTION 1.1 Background to the War ............................................................................................8 1.2 Why the Issue is Important: Murder, Terror, Theft .................................................8 1.3 A Crisis of Modernity? ............................................................................................9 1.4 The Political Economy of War ..............................................................................11 1.5 Private Power, Commerce and State Institutions...................................................12 1.6 Conclusion .............................................................................................................13 2. WORLD DIAMOND RESERVES AND PRODUCTION 2.1 Introduction............................................................................................................15 2.2 An Important Note on Statistics.............................................................................16 2.3 The Future Production of Diamonds......................................................................17 2.4 Sierra Leone and West African Diamonds ............................................................18 3. ORGANIZATION OF THE INDUSTRY 3.1 A Preliminary Roadmap .......................................................................................19 3.2 De Beers – A Diamond is Forever .......................................................................21 3.3 The Belgian Connection. 26 4. THE SIERRA LEONE DIAMONDS 4.1 Origins. 38 4.2 The Beginning of Privatised Violence...................................................................39 4.3 The End of Corporate Control & the Emergence of the ‘Shadow State’ ..............40 4.4 The Failure of ‘Reform’.........................................................................................42 4.5 Lebanon, Israel & the Arrival of International Organized Crime..........................43 4.6 The Liberian Connection .......................................................................................45 5. THE ‘JUNIORS’ 5.1 The Canadian Connection......................................................................................48 5.2 Rex Diamond Mining Corporation ........................................................................48 5.3 AmCan Minerals Limited ......................................................................................51 5.4 DiamondWorks and Branch Energy .....................................................................53 5.5 Conclusions: Mining the Stock Market; Concessions for Protection....................60 iii/ SIERRA LEONE, DIAMONDS AND HUMAN SECURITY 6. LOCAL PLAYERS. 62 7. OTHER ISSUES 7.1 Diamond Identification. 64 7.2 Certificates of Origin. 65 8. RECOMMENDATIONS. 67 BOXES 1. Key Points in Sierra Leone’s History. 10 2. Playing Rough in the Diamond Business . 23 3. How Prices are Maintained . 24 4. Diamonds and Drugs: The Collapse of the Max Fischer Bank . 35 5. Crooks . 56 6. Rakesh Saxena: Financial Wizardry, Diamonds and Guns . 57 7. Interview with DiamondWorks’ Bruce Walsham . 59 ANNEXES 1. A Note on Canadian Junior Mining Companies. 74 2. Diamond Properties Held in Sierra Leone by International Mining Companies. 77 · List of Individuals Interviewed. 79 iv/ SIERRA LEONE, DIAMONDS AND HUMAN SECURITY ACRONYMS AFRC Armed Forces Ruling Council APC All Peoples Congress CAST Consolidated African Selection Trust CSO Central Selling Organization EO Executive Outcomes GGDO Government Gold and Diamond Office HRD Hoge Raad voor Diamant (Diamond High Council) NDMC National Diamond Mining Company NPFL National Patriotic Front of Liberia NPRC National Provisional Ruling Council OAU Organization of African Unity PMMC Precious Metals Mining Company RCMP Royal Canadian Mounted Police RUF Revolutionary United Front SLPP Sierra leone People’s Party SLST Sierra Leone Selection Trust UNDP United Nations Development Program USGS United States Geological Survey VAT Value Added Tax v/ SIERRA LEONE, DIAMONDS AND HUMAN SECURITY “Oh, the diamonds, diamonds, diamonds,” Yusef wearily complained. “I tell you, Major Scobie, that I make more money in one year from my smallest store than I would in three years from diamonds. You cannot understand how many bribes are necessary.” - Graham Greene, The Heart of the Matter, 1948 The diamond, a symbol of purity, makes a market that functions both above and below ground, in which the licit and the illicit mingle freely and comfortably, the line between them almost imperceptible, usually irrelevant. Diamonds bring out the worst in men---and women. - David Koskoff, The Diamond World, 1981 Loot, not better government, has motivated the psychotically brutal guerrillas of Sierra Leone. They trade the diamonds they control for arms through neighbouring Liberia, under sponsorship of President Charles Taylor, their longtime patron. - New York Times, Editorial, August 8, 1999. vi/ SIERRA LEONE, DIAMONDS AND HUMAN SECURITY FOREWORD The processes of mining, trading and selling diamonds are myriad and byzantine; only those intimately involved in the industry truly comprehend its vagaries. Sierra Leone has one of the richest mother lodes of diamonds in the world. Over the years, the ramifications of diamond extraction in Sierra Leone have intrigued the international community, spawning numerous articles and books, from Graham Greene’s The Heart of the Matter, to Robert Kaplan’s The Ends of the Earth. But more recently, Sierra Leone has intruded on the world’s attention for other reasons. The recurring conflicts and brutality; the uprooting of fully half of its people, the mutilation and murder of its children have shocked even the most hardened observers. And many are asking: How can peace and stability be restored in Sierra Leone? Is there a connection between the illicit diamond trade and the mayhem that has disfigured Sierra Leone in recent years? What can the international community do to assuage the trauma of conflict in Sierra Leone? These are the questions this study seeks to address. Too often in the past the powers of the North have felt compelled to help resolve tensions in countries with which they felt some compatibility, while ignoring similar struggles in countries of the South. One has only to contrast the attention accorded the conflict in Bosnia with what was given Rwanda; or of Kosovo with Sierra Leone. The eight million refugees and internally displaced persons throughout Africa are symptomatic of this lack of concern. Root causes of conflict in Africa are ignored. The authors of this report are to be commended for their investigation. In reading their report, I can only conclude that greed and corruption - local, regional and global in scope - have encompassed Sierra Leone’s diamond industry, and are the root
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