The efforts to reach out and get African producers involved in the Precious Stones Multi-Stakeholder Working Group (PS-MSWG) at last proved successful: representatives from a handful of African nations traveled to Paris. They were joined by some 50 private companies, NGOs and government members of the Multi Stakeholders Working Group.

Judging by Tweets and other feedback, the Africans came with high anticipations but left quite disappointed; some were even upset. This might have been due to miscommunication. Some mistakenly believed that this was a governmental OECD meeting. The OECD spokesman, who dominated the morning sessions, made it very clear that his (OECD) participation was merely as an Observer.

It was explained that the OECD has nothing to do with the PS-MSWG initiative and that it was merely relating some of its experiences on other conflict minerals guidelines as well as making room facilities available to the Working Group. The OECD took no part in the meeting’s tangible discussions, which were mostly held in the afternoon session.

No Study on the Table
The African producers had come to Paris with the expectation that there would be a PS-MSWG study on the table and that this was the raison d’être for the meeting. The “revised agenda” was only received by most of the participants last Friday afternoon just before the Monday meeting – when the African delegations were already travelling. During the meeting, a U.S. participant clarified that “the study is in draft form – being researched and developed.” The suggestion was then made that perhaps the next draft could be circulated to people in the room, though it would still take quite a while for it to be completed. [DIB’s understanding is that one shouldn’t expect another draft before September. The study’s authorship was left unchanged, at least for now.]

Needless to say, the absence of a study on the table – a study that ostensibly was to be presented to the OECD – was quite unsatisfactory to some of the African participants and many others. “How can we justify to our governments the travel spending just to attend a meeting called by some private retailers, US government and NGOs?,” asked one vocal and senior African government representative (whose name was not disclosed to us because of the Chatham Rule – which encourages public discussion on all issues raised at the Paris Meeting, but does not allow mentioning of specific individual names).

Participant Feedback
On social media networks, the meeting was characterized as just another attempt by the companies and governments of the North to dictate and regulate the governments of the (ex-colonial) South. “They don’t realize that these years are over,” was one such comment that I read. Along these lines, a high-ranking Namibian official later wrote on his Facebook page: “When the North makes rules for the South – and when we are expected to toe the line – it’s time to speak up!”

One African nation emphasized that “this was more of a fact finding mission for us – learning about the process.” He understood that “no action would be taken,” stressing that “we have no mandate to endorse anything.”

During the meeting, many comparisons were made between the PS-MSWG initiative and the creation of the Kimberley Process. “KP was a tripartite forum – the onus was not just on governments,” read one comment. However, a member of the group of PS-MSWG core organizers worked hard to make the (apparently not very convincing) argument that this due-diligence-guideline exercise has nothing to do with the Kimberley Process. “Consumer confidence is a core value of all the people here. But this is not the sole purpose. We care deeply about the people in our industry and sustaining their jobs and circumstances in which they operate.”

Additionally, in reference to the reform process within the Kimberley Process, which has so far failed to widen the conflict diamonds definition to include human rights elements, the PS-MSWG initiative was also presented as un-related to KP. “Consistent with international principles already accepted, we only want to make clear associations between the [human rights] associations and what we sell.”

The ‘Midstream’ Perspective
A spokesman for a major cutting center expressed concern about multiple processes governing the diamond pipeline. “They should be consistent across the board.” Presently, there “is a dichotomy because of the talks about human rights. Any government that is not accepting the widening of the definition of conflict will find it different to support another forum (or platform) where such widening has taken place. This will be dichotomous.”

The advantage and importance of the KP, it was stressed, comes “from the special waiver it received from the World Trade Organization (WTC).”

[Some of the PS-MSWG participants may not have been aware that the Kimberley Process is enshrined in a voluntary political document with no commitments of legal nature, providing guidance to participants on how to implement the certification scheme at the national level. In a way, this is quite similar to some OECD (and FATF) guidelines (or recommendations). Therefore, the scheme as such does not constitute a trade measure in WTO terms and is not under scrutiny of the WTO. However, since the Kimberly Process clearly represents a serious restraint of trade (members can only trade rough diamonds with other members and sales to non-members are prohibited), a WTO waiver was required to enable the legal enforcement of the restrictions. (See: Article IX: 3 of the WTO Agreement.) That puts the KP clearly at an advantage over other contemplated schemes.]

The cutting center spokesman stresses that “diamonds fall clearly in other human rights regimes, such as ILO, UNHRC and others.” Whatever is being said and done here, with regard to the PS-MSWG, “in the long run, the Initiative will affect other processes, including the KP.” Concern was expressed that in the PS-MSWG “rules have not been defined.”

An African government official echoed that sentiment: “We [PS-MSWG] are trying to run a parallel process.”

A main core sponsoring government spokesman was quite receptive to this argument. “It might be worthwhile to decide to reset the PS-MSWG initiative and start a whole new platform. Governments can initiate an exchange of letters – and even issue formal invitations, if required. Clearly a method must be found to formalize this group,” it was stated, though it is not known if this is something that can be asked from the OECD.

Human Rights Core Concern
A rather vocal African producer made it abundantly clear that “we believe in human rights, but ambiguity is the problem. We need to set clear boundaries. If we don’t have clear boundaries – and a very clear de-politicization of the process – this [proposed guideline] can trip us.” One of the initiative’s core members clarified that “the process is to clear ambiguity. The purpose of OECD guidance is to get a conflict definition that ensures getting around the tricky parts.”

An additional comment was: “Human rights languages are too sweeping and general (shades of grey) – and much too open to interpretation. Russia can be considered a conflict country; a South African shooting of miners likewise. Clear defined boundaries are needed.”

An NGO zoomed in on this issue: “All of us are concerned about human rights. We are talking about shades of grey – it is always a qualitative matter. Flexibility is a good thing – especially when reality is complex. [This is] not about absolute lines, but rather about engagement,” according to this NGO.

(Interestingly, one of the NGOs, Partnership Africa Canada, had carefully timed the publication of a scathing attack on Dubai and the DRC, with regard to human rights and mineral supply chains, with the opening of the OECD meetings.)

Another African producer stressed that “these are discussions to be held in a KP framework. Some two years have been spent on exactly the definition of conflict – and we looked at all aspects and there is some agreement, even if we could not agree on some points.” This spokesman believes that the debate on all the precious stones issues (also non-diamonds) should take place in a KP framework.

One of the African KP founding countries recalled that, initially, “the United States, India and Russia were strongly opposed to establishing the Kimberley Process. The U.S. turned around when there were concerns about terrorists laundering monies. African countries wanted the KP, and it was recognized that NGOs, governments and industry were needed to get it done.”

Back to Inclusiveness
One of Africa’s most important diamond producers took issue with what he perceived as “the gap between the market and bush.” The producer wants a better integration of the value chain. He said: “The language which we should be having is value chain integration and ensuring how there is responsibility at all points in the chain. Mining is a source of developments. Many of the issues [on the table here] keep us awake at night.”

He appealed to the “North,” to the retailers, to look at the submissions made by the African participants “in the proper context.” Said the producer: “We are not people of [the] bush – we find it all quite patronizing. It is all presented in contexts that will not be understood [at home]. You are reaching out and want us to participate.” He added that “it is extremely difficult for us [in the present context] to make a meaningful contribution.”

One European government kept quite an open mind on this: “Maybe we should engage in discussions with governments on due diligence. Governments can be invited as one government to another. We are comfortable with a multi-stakeholder environment, but are happy to go bi-lateral as well.”

Process in Early Stage
One government stressed that from its perspective there were two different issues: OECD Due Diligence Guidelines and the PS-MSWG initiative. “Both are different; [our government] is part of both. Government has a national action plan to implement guidelines. However, the PS-MSWG process is still at a very early stage – and there are no proposals at this stage. No one is saying that international regulations or an OECD guidance [on precious stones and diamonds] is necessary.”

Continued the spokesperson: “Let’s first get to a working paper – then we can have a discussion and look at options.” The spokesperson assured that “nothing will go beyond working group without talking to governments.”

Variety of Views
Not everyone believed that government should be involved in the PS-MSWG initiative. “The idea is that we satisfy consumers who are looking for due diligence. Our [retailing] incentive is the consumer – if they don’t buy, we don’t get the revenues. However, if governments get involved it becomes like Dodd-Frank. It must be realized that consumers don’t understand the Kimberley Process. KP is a gov’t to gov’t interaction. Due diligence is all about what is needed so that we and our consumers sleep at night.”

This retailer feels that “the responsibility is not on the producer country. If a consumer in the United States wants due diligence, he will get it. Due diligence is not prescriptive – nor will it dictate what I do. It is what I have to do and what I choose to do [to sleep at night].”

One “Midstream” spokesman commented that “everyone is referring to the consumer.  I find him a strange animal. He is not aware at all of the issues at stake. The 2014 consumer is in the Gulf countries, in India, in China. There are no issues there at all. The United States’ market share [in diamond] is declining – some 30%. In Europe, diamond consumption is so minimal (below 10%) that it isn’t on the map of De Beers anymore. Somehow,” said this spokesman, “we take it for a given that a consumer implicitly wants it.” This speaker doesn’t consider that as axiomatic. “I am not even sure that there is much awareness of any of this in the United States.”

What Will Be Next?
The publicity within the diamond trade press – and mostly Diamond Intelligence Briefs – has contributed to an enhanced awareness of the PS-MSWG within the “Midstream” of the diamond value chain. The presidents of the major industry representative organizations – the WFDB, IDMA, WDC, and CIBJO – will be meeting in early June in Antwerp to arrive at a joint position on the PS-MSWG, on whether to join it, simply ignore it, or whether to create its own initiative and reach out to the OECD. The WFDB President did send an Observer to the Paris meeting, and all major cutting centers were represented. That’s enormous progress.

What conclusions can be drawn? The writer of this editorial, who was scheduled to participate but at the last moment couldn’t make it, has talked to numerous participants – and will continue to do so. What has become clear from the feedback is that the OECD now has serious problems regarding whether to view the PS-MSWG as really truly representative of the full value chain. The last thing the OECD wants is a confrontation with African producer countries. If there was one really contentious issue at the meeting it was the attitude towards producers.

Can the PS-MSWG change directions? To some participants I spoke to it was clear that the entire exercise needs to go back to the drawing board; it needs rethinking. It may need a completely different composition and leadership – and the PS-MSWG Study ought to be dumped. The new study must then be shaped by the Terms of Reference to be set by the newly restructured group – should there be one.

This article originally appeared in Diamond Intelligence Briefs.