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Rough diamond valuation global industry challenge

3rd June 2016

  

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Rough diamond valuation remains a challenge that is not limited to one country, one diamond centre or the government-led certification scheme the Kimberley Process (KP), it is a critical challenge for the entire diamond industry, says United Arab Emirates (UAE) KP chair Ahmed Bin Sulayem.

“[Diamond valuation] is a top priority for the diamond exporting countries in Africa, which are looking to get the best value from their mineral resource wealth. As KP chair, it is my goal that our work will lead to a concrete action plan towards a set of best valuation practices and, ultimately, a level playing field for all importers and exporters of rough diamonds,” Bin Sulayem noted at the KP’s intersessional meetings, where 200 delegates gathered at the Atlantis, The Palm hotel, in Dubai.

Diamond valuation was a key topic throughout the KP’s intersessional meetings from May 24 to 26, with the UAE KP chair hosting a one-day ‘KP Chair Special Forum’ on rough diamond valuation, as a precursor to the KP intersessional meetings on May 23.

The forum covered topics on rough diamond valuation challenges, as well as the Organisation for Economic Cooperation and Development’s (OECD’s) work on enhancing the private-sector contribution to responsible mineral supply chains and support to developing countries in raising revenue from extractive industries.

The OECD, which has developed the Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict & High Risk Areas, also joined the special forum as an industry specialist and observer.

“The OECD is an institution with unparalleled global experience related to valuation common approaches and supply chain due diligence, and the KP can benefit greatly from leveraging their knowledge. It is my goal that we begin taking the first concrete steps in tackling essential items, such as enhanced data collection, financial transparency, cross- border trade and supply chain traceability for the benefit of our industry,” Bin Sulayem said.

Within the KP, both the Washington Declaration from 2012, and the Moscow Declaration from 2005, were initial attempts to tackle valuation of rough diamonds. These declarations were outlined as policy goals and recommendations, but were never actioned in the industry.

Bin Sulayem highlighted the importance of the UAE KP chair’s work with the Central African Republic, which has resulted in the country’s Berberati province recently being declared a compliant zone, as well as progress following a visit to Venezuela earlier this year to assist the country in being readmitted to full KP membership during Bin Sulayem’s term in the country’s quest to resume diamond sales.

The UAE was selected as the first Arab country to chair the KP, a group tasked with regulating the global diamond trade. The group, which was established in 2003 by the United Nations heads of 81 participating countries, seeks to ensure that unregulated rough diamonds do not enter the legitimate diamond market as a means to finance conflict. This has also ensured that, over the past 13 years, the mandate has fostered greater transparency in the industry by implementing a rigorous certification scheme.

UAE Sultan Bin Saeed Al Mansouri emphasised at the conference that the global body strives to enable trade to flourish in a safe and stable environment, so that all participants and their dependent societies can benefit to the full.

“We believe it is so fitting that the UAE has built so many strong and lasting partnerships within this vital institution. Our doors are always open to friends and partners from every corner of the globe, from every walk of life, as we strive to reach a common goal together,” he said.

World Diamond Council president Andrey Polyakov also urged a broader group of fellow international and credible nongovernment organisations (NGOs) at the event to join the KP to be a part of the future of the diamond industry, rather than to allow any single NGO to prevent the KP from enhanced collaboration with civil society.

Edited by Tracy Hancock
Creamer Media Contributing Editor

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