On January 1, the UAE takes over as chair of the Kimberley Process, which is an important global working group in the diamond industry dedicated to stopping the trade of conflict diamonds,
Ahmad Bin Sulayem is the UAE's representative in the Kimberley Process and once he becomes chair his three priorities are to improve the organisation's growth and reach, strengthen the ties between industry, government and civil society in the organisation, and to help new countries join the Kimberley Process.
Bin Sulayem also plans to look into other challenges the diamond industry needs to deal with, like the "undervaluation” of rough diamonds engaged in by some producing countries. He wants the industry to work towards an internet cloud-based regime where data can be passed through to the channels more quickly.
"There is definitely a need for the Kimberly Process to do more … [although] some feel it will add levels of complexity. As time moves forward, we have the capabilities to make those changes” he said.
During the UAE's chairmanship, the country will host two major meetings of the diamond industry, the Kimberly Process' intercessional in May and the plenary meeting in November. Dubai is now one of the top three diamond trading centres in the world and the annual diamond business in the UAE is valued at US$30 billion (Dh110 billion).
The Kimberley Process seeks to stop conflict diamonds (or blood diamonds as they are more commonly known) from leaving the mines of a producing country caught up in wars or internal conflicts and their trade in global markets.
The project has been in place since 2003 and has made significant progress with conflict-related rough diamonds making up less than 1 per cent of the stones available in the marketplace now. There are 84 countries that have signed up for the Kimberley Process.
Yet, "the Kimberly Process face[s] different challenges … even now,” Bin Sulayem, who is also Executive Chairman of DMCC (Dubai Multi Commodities Centre), told Gulf News. "We have noncompliant members whom we would like to bring back to the fold”.
"We don't want to have an unresolved situation with a country … today we are trying to finalise the Central African Republic situation. There is a temporary solution, but we want to have a more permanent one.
"It has been an ongoing matter for the past few years. We are part of the committee that's working with the US. At the end of the day I'm confident there will be a solution,” he said.
"The Kimberly Process is also there to foresee future challenges. As far as the UAE concerned, it's important to make sure the work in progress goes [on] seamlessly and provide the right environment.”
Diamonds need to be certified to ensure "they came from an origin that is conflict-free,” said Bin Sulayem. And with the creation of the Kimberly Process "the industry stepped up. If it hadn't, it risked losing consumer confidence.
"Diamonds have a sentimental value and when it's dented, it does not just lose value … it will not work. [This is] unlike oil which is a necessity and gold, [which is] a currency.”
But for the diamond industry as a whole, these are uncertain times. Sales of rough diamonds by De Beers, the conglomerate that is the industry bellwether, were the lowest in 30 years, according to Bin Sulayem.
"Demand for rough diamonds is so low that De Beers declined to purchase diamonds from its Debswana joint venture and the Botswana government's own auction sales were cancelled.
"Banks are withdrawing from the industry … African countries will be the primary losers in this industry shakeout. Countries like Botswana cannot afford to have a year or two of no sales.”
• A federal decree was issued in 2007 mandating DMCC (Dubai Metals and Commodities Centre) bare sole responsibility for certifying the entry and exit of diamonds in the UAE.
• DMCC came into being in 2002.
• In January 2003 the UAE became a signatory of the Kimberley Process, which aims to stop conflict zone diamonds from being traded.
• Currently, the size of the diamond industry in the UAE is valued at more than US$30 billion, making it among the top three hubs for the trade, along with Belgium and India
Source: Gulf News