The 2016 KP Plenary kicked off yesterday in Dubai as KP Chair Ahmed Bin Sulayem welcomed representatives of 81 governments and industry organizations. First day activities included a third diamond valution forum addressing the elusive question of how to provide fair value for diamonds from Africa and achieve a formalized approach to valuing diamond resources. In his opening address Bin Sulayem said, "We have three major initiatives to discuss this week, including the steady march towards a common approach to valuation; the move to establishing an efficient Permanent Secretariat, commensurate with the extraordinary tasks and responsibilities that the Kimberley Process family takes upon itself; and the independent funding of Civil Society. I am grateful for, and humbled by, the task that we have been set. But I am proud of us all here today, proud of the progress that we have made this year, and I am immensely optimistic for the future.” He announced that $25,000 would be contributed to the creation of an Independent Fund for NGOs involved in the KP, and also called for industry to contribute to help establish a total fund of $105,000, saying this would go a long way enhancing transparency and harnessing the full power of the Civil Society.
World Diamond Council president Andrey Polyakov speaking on opening day reiterated: "One of the biggest challenges today is valuation. Primarily countries with small-scale artisanal mining are faced with the complexity of it. Lack of practical experience and qualified specialists, as well as fragmentation of approaches towards valuation prevent some countries to efficiently and accurately assess potential revenues. These shortcomings in the end also create space for non-transparent operations with rough diamonds. It is obvious that this problem is very complex, but nothing is easy on the right path, and I am glad to witness the KP paying appropriate attention to it." Assessing the ongoing work of the KP, Polyakov stated, "Today the diamonds which were called “blood or conflict diamonds” are almost completely excluded from the global trade ... We probably won't ever be able to say with certainty that we achieved a 100% clean trade. Neither does the palm oil or cacao industry. As in any other global business, it is impossible to follow every merchant in the world ... But it is our goal to try every day to achieve it.
He continued, "Today we can be confident that if a person comes into a store, he or she buys there a piece of jewelry set with a non-conflict stone." On the KP's efforts to reintegrate CAR: "For those who think KP is no longer of use, I believe its never ending importance was again underlined this year. The story of CAR brings positive news not only to the diamond market. Its value is far bigger - as out of the CAR’s 4 million population, 1 million people rely on the diamond industry for their livelihood. With the resumption of legitimate trade, the budget of CAR started receiving much awaited income from diamond mining and begin economic recovery. Many people of CAR can finally get a legitimate job." The KP Chair is also proposing to establish a Permanent Secretariat under the UN, with funding from diamond consuming nations and led by an African national with in-depth knowledge of the process.
The plenary, however, is taking place without the presence of the non-governmental organizations that form one of the three pillars of the KP structure: the Civil Society Coalition. The formal announcement of their decision to keep the boycott in force reads as follows:
Civil society who are members of a conflict diamond certification scheme have declined an invitation to end their boycott and attend the upcoming Kimberley Process Plenary meeting held in Dubai from November 13-17. In a letter to the KP Chair, Ahmed Bin Sulayem, the Kimberley Process Civil Society Coalition refused to end the boycott explaining the UAE had not taken steps to address the issues within its own jurisdiction. The 11 members of the Coalition had announced the boycott of this year's Chair—the United Arab Emirates—due to widespread concerns over the country's lenient standards and antagonistic relationship with the Coalition. The Coalition wrote that by failing to address internal issues, it "rendered the UAE's presidency of the KP as flawed at the end of 2016, as it was in Luanda in November 2015."
Established in 2003, the Kimberley Process Certification Scheme requires participating countries to develop internal controls to ensure that conflict diamonds are excluded from international markets. Each shipment of rough diamonds must be accompanied by a certificate attesting to its conflict-free status. This year's Chair—the UAE—is the third largest diamond trading centre in the world, trading approximately $40 billion worth of diamonds in 2014, according to the Dubai Multi-Commodities Centre. However, civil society and UN experts have raised concerns about negligent import controls that allow illicit diamonds to come in from conflict areas such as the Central African Republic, as well as the issue of undervaluation of diamonds, known as "transfer pricing." In 2014, exports of diamonds from Dubai were on average 44 percent higher than their original import values.
Writing to the Chair, the Coalition was concerned that the series of Valuation Seminars undertaken by the UAE this year "are designed to deflect attention away from the UAE addressing specific vulnerabilities and responsibilities regarding valuation within the Dubai Multi-Commodities Centre (DMCC)." While the Coalition welcomed two proposals put forward by the KP Chair—a Permanent Secretariat under the United Nations and an independent funding mechanism for the Coalition—it calls for clarity and definition as the concepts move forward. Specifically with a proposal on funding that would have civil society funded by industry members, the Coalition noted, it "has the potential for unacceptable conflict of interest implications." The Coalition's preferred option has always been a multi-donor trust fund made up of contributions from KP participants and industry that would ensure the Coalition can safeguard its independence and editorial integrity. Such a fund would also support resource constrained governments in improving their KP compliance.