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Israel’s diamond exports crash as BDS and war crimes impact

By Sean Clinton | MEMO | November 7, 2018

Fig.1 – Graph of diamond exports and trends from main exporting hubs

Israel’s gross diamond exports have crashed by a staggering 45 per cent since the 2014 massacre in Gaza that resulted in the death of over 2,200 people, mainly civilians including over 550 children.

The net value of Israel’s diamond exports has fallen even further, by 60 per cent from $11.25 billion to $4.4 billion over the period. This is about the same as the value of Israel’s total arms exports.

The Israeli diamond exchange initially blamed the decline on weak global demand and more recently on globalisation but the sudden steep decline shows that’s plainly not the case.

De Beers annual insight reports on the state of the global diamond market show demand increased slightly over the past five years.

No other diamond exporting country has suffered such a steep fall.

The Belgian diamond industry, which is a major hub for both the rough and polished diamond trade to and from Israel, has also been impacted by the steep decline in Israel’s exports.

Meanwhile India has gained market share and in 2016, for the first time ever, exported more diamonds to the USA than Israel which has traditionally supplied up to 50 per cent of the US market in value terms.

There can be no doubt that one of the most important and the most vulnerable sector of the Israeli economy is feeling the impact of Israel’s blood-drenched brand image.

Fig. 2 – Israeli manufacturing exports declined sharply after 2014 led by a 45% fall in diamond exports. The 2012 fall in diamond exports was due to the discovery of major fraud in the Diamond Exchange.

The global campaign of boycott, divestment and sanctions (BDS) has highlighted jewellery industry links to Israeli human rights violations which are funded to a significant degree by revenue from the diamond industry. Both appear to be impacting the Israeli diamond industry particularly hard with exports down a further 6 percent in H1 2018.

The situation has become so serious that Israel is now offering to pay air fares as well as provide free hotel accommodation to attract buyers to Tel Aviv. Although the jewellery industry and NGOs have remained silent about Israel’s leading role in the diamond supply chain human rights activists have campaigned to expose it.

In 2012 activists first revealed the linkage between the Steinmetz Diamond Group (SDG) and the Givati Brigade of the Israeli military which was responsible for the 2009 massacre of the Samouni family in Gaza, a suspected war crime documented by the UN Human Rights Council and others including Israeli human rights group B’Tselem.

This set in motion a series of actions that continue to reverberate through the upper echelons of the diamond industry. When the Anglo American owned De Beers Group put a Forevermark Steinmetz diamond on display in the Tower of London in honour of the Queen of England’s Diamond Jubilee the Inminds human rights group staged regular protests outside the Tower.

A member of the Samouni family in Gaza recorded a video appealing for the blood diamond to be removed. The diamond was removed a few months later without any of the fanfare and publicity that accompanied it’s unveiling. It hasn’t been seen or heard of in public since.

Sotheby’s Diamonds is a 50:50 partnership between Sotheby’s, the famous auction house, and Diacore, the now rebranded Steinmetz Diamond Group.

Since 2012, Inminds has staged a number of protests outside Sotheby’s premises in Bond Street, London, highlighting the link to Israeli war crimes.

In January 2013, Sotheby’s CEO and board were sent a registered letter alerting them to the damage to their reputation and the risks to their brand posed by their partnership with the Steinmetz Group. Months later in Geneva, in a blaze of global publicity, Sotheby’s auctioned the Steinmetz Pink, a specimen diamond. It was bought by a syndicate of investors lead by Isaac Wolf for a world record US$83 million. The pre-auction publicity and spin gave no indication that the diamond was tarnished by association with Israeli war crimes in Gaza and was, therefore, a blood diamond. Four months after the auction it was revealed that the investors defaulted and Sotheby’s were forced to take the diamond into inventory costing them millions.

In April 2017, in a much quieter event, the blood diamond was auctioned in Hong Kong and bought by Chow Tai Fook for $71 million.

The Isaac Wolf syndicate wasn’t sued.

Diamond buyers and sellers attend the International Diamond Week (IDW) in the Israeli city of Ramat Gan, east of Tel Aviv on February 14, 2017. (JACK GUEZ/AFP/Getty Images)

Sotheby’s continues to partner with Diacore despite the fact that the Steinmetz Foundation “adopted” the Givati Brigade which stands accused of war crimes.

As news of the default became public it was also disclosed that Beny Steinmetz sold his interest in SDG to his brother Daniel and the company was rebranded as Diacore. Some observers believe this was an exercise designed to distance leading diamond brands including Tiffany’s, De Beers, Sotheby’s and Forevermark from the tarnished Steinmetz brand which is indelibly linked to the Samouni massacre. Evidence supporting this was leaked in the Panama Papers which showed that in 2015, Beny Steinmetz was still involved and asked Mossack Fonseca to backdate the transfer of his power of attorney to his brother to 2013.

Further indications that jewellers are shunning diamonds linked to Israeli human rights violations emerged earlier this year when it came to light, via a Tiffany & Co Form 10-K submission to the US Securities and Exchange Commission, that the iconic diamond brand had terminated a supply agreement with a Steinmetz owned mine in Sierra Leone. Tiffany’s loaned Steinmetz $50 million to develop the mine and was one of their leading buyers.

Tiffany’s divestment came following pressure from human rights activists who exposed the fact that Tiffany’s sourced diamonds from a miner that donated to and supported suspected Israeli war criminals.

Although Tiffany & Co divested from a Steinmetz mine they continue to conceal the identity of the companies they buy 25-35 per cent of their polished diamonds from. Tiffany’s customers cannot, therefore, know where their jewellery comes from as alluded to by their new CEO Alessandro Bogliono in Tiffany’s Sustainability Report 2017.

“Our customers place great value on sustainability. They want to know where their jewellery comes from, how it is made and how the jewellery-making process impacts the planet as well as its people and communities. Tiffany & Co. holds this kind of transparency dear and, through this creation of shared value, we have a unique opportunity to build meaningful, lasting relationships with our customers. We are committed to sharing more with them — and all of our stakeholders — about what, exactly, Tiffany is doing to achieve sustainability for our business and for the planet as we very broadly define that goal: enriching the people and places we reach through our business; minimising our environmental impact; improving industry-wide practices; and channelling the power of the Tiffany brand as a force for positive change in the world.”

Given Israel’s leading role in the industry and the absence of a statement from Tiffany’s stating, as they have done with Zimbabwe and Angola, they do not buy diamonds from the apartheid state, it is likely Tiffany’s are sourcing diamonds from companies in Israel.

Fig. 3 – On June 1st, Rajan al-Najjar, a 21 year old paramedic, was shot dead by an Israeli sniper as she treated wounded civilians in Gaza.

Diamond companies in Israel employ people who have served in and are members of the Israeli army, have openly funded and supported attacks on the defenceless residents of Gaza, have been widely implicated in serious fraud and who discriminate against non-Jews who make up 20 per cent of the population.

Furthermore, Tiffany’s haven’t paid reparations to the Samouni family or any of the victims of the Steinmetz supported Givati Brigade. Mitigation for damage caused is a key component of “responsible sourcing” as outlined in the OECD Due Diligence Guidelines to which Tiffany and Co, a member of the UN Global Compact, claims it is committed.

Although revenue from the diamond industry is a significant source of funding for an apartheid regime that has killed over 210 Palestinians including women, children, medics and journalists and injured and maimed thousands more with live ammunition in besieged Gaza in the past six months alone, jewellers fraudulently claim diamonds processed in Israel are responsibly sourced and conflict-free.

This blood diamond cover-up and fraud is perpetuated by public companies and governments who collaborate to shield rogue regimes in Israel, Zimbabwe and Angola that they depend on to keep their coffers full, bolster dividends for shareholders and provide fat pension pots for c-suite executives.

The Kimberley Process Certification Scheme (KP), the blueprint of which was drafted by the World Diamond Council, is the primary vehicle facilitating the ongoing blood diamond trade.

Although the remit of the KP is deliberately restricted to banning rough diamonds that fund rebel violence, jewellers use it to claim other blood diamonds are conflict free even when they fund war crimes and crimes against humanity.

Shamefully, Amnesty International, Global Witness, Human Rights Watch and Impact (Partnership Africa Canada), that the public rely on to expose the blood diamond trade and speak up for the victims, have said and done nothing to hold the diamond jewellery industry to account for funding Israeli war crimes and crimes against humanity.

Fig.4 –The diamond industry has created a matrix of bogus schemes, warranties, standards and codes of practices to con consumers and facilitate the trade in blood diamonds that fund rogue regimes

The silence of NGO’s on Israel’s blood diamond trade means the Kimberley Process charade continues to con most people and can keep mainstream media focused on the mining sector in Africa. Meanwhile, high street jewellers launder cut and polished blood diamonds labelled responsibly sourced and conflict free to unsuspecting customers.

Hilde Hardeman is the EU chair of the Kimberley Process in 2018. Indications to date suggest that she, like others before her in South Africa and Australia, will ignore the latest call from human rights activists for Israel to be suspended from the KP until those responsible for massacres in Gaza are brought to justice and held to account.

Some voices in the jewellery industry are speaking out. The most recent example being the Ethical Jewelry Exposé: Lies, Damn Lies, and Conflict Free Diamonds, from Marc Choyt and his team at Reflective Jewellery. The exposé peels back the layers of bogus schemes “through the metaphor of Russian nesting dolls, with eight layers of babble obscuring the nefarious truth hidden at the core”.

The exposé leaves readers in no doubt as to the magnitude of the fraud being perpetrated by the key stakeholders in the diamond industry, particularly the Responsible Jewellery Council which is now chaired by Signet Jewellers Vice President of corporate affairs, David Bouffard. Signet Jewellers source many of their diamonds from companies in Israel.

The successive withdrawal of human rights organisations from the KP, including Global Witness, Impact Transform, International Alert, Fatal Transactions and Ian Smillie – a key architect of the Kimberly Process scheme – has removed the fig leaf and left its exponents exposed with their bloody diamonds in full view.

Scrambling to conceal the blood diamond trade, the industry’s most recent and emerging addition to the matrix of deception, is the use of blockchain technology to digitally log all transactions a diamond undertakes from mine to market. While the technology has the potential to give consumers the information needed to make an informed decision about the ethical provenance of a diamond, the detailed information will only be available to “authorised users” as “privacy controls” will prevent consumers from accessing “sensitive data”.

Diacore, of the Steinmetz Group, was one of the first companies in a trial conducted by De Beers Group of their blockchain system, Tracr, earlier this year. It is clear, therefore, that blockchain will provide another layer of cover for the blood diamond trade while consumers are kept in the dark.

As the EU chairs a Kimberley Process plenary meeting in Brussels from November 12-16 it will be interesting to observe the corseted language emanating from the spin doctors. No doubt they will inform the public that the major reforms aimed at strengthening the KP and giving added assurance to consumers have been agreed. But one thing is for sure, any reforms that are agreed will not extend to banning blood diamonds that fund rogue regimes guilty of gross human rights violations in Israel, Zimbabwe or Angola.

Read:

Why Israel sees BDS as a ‘strategic threat’

EU urged to end trade in Israel diamonds

Israel’s $72m war chest to fight BDS comes to Brussels

November 7, 2018 Posted by | Deception, Economics, Ethnic Cleansing, Racism, Zionism, Solidarity and Activism, War Crimes | , , , , , , , , , , , | 3 Comments

South African organisations call for Israel to be excluded from diamond processing

MEMO | June 5, 2013

Human rights groups, trade unions and several other major civil society organisations have called for the Kimberley Process Certification Scheme to exclude Israel. The international diamond regulatory body is meeting in South Africa and is chaired currently by Pretoria’s former ambassador to Washington, Mr Welile Nhlapo.

Organisations including South Africa’s National Union of Mineworkers (NUM); the country’s largest trade union federation, COSATU; the SACP; YCL; South African Students Congress (SASCO); Congress of South African Students (COSAS), the Coalition for a Free Palestine and BDS South Africa are behind the call.

A statement issued at a press conference held at COSATU’s Head Office in Johannesburg pointed out that the KPCS presents an opportunity for South African officials to show “moral vision and political leadership” by excluding Israel. “The billions of dollars’ worth of diamonds exported via Israel are,” said the coalition, “a major source of revenue for the Israeli military, which stands accused of war crimes.” Such a move would have local benefits too, it added, by “bringing home” many lucrative diamond processing jobs to South Africa. Income from diamond processing carried out in Israel also, alleges the coalition, helps to develop military hardware such as pilotless drones.

Speaking to Business Day newspaper, Southern Africa Resource Watch director Claude Kabemba commented that most diamond-linked conflicts had been resolved, and the Kimberley Process now had to expand its mandate and monitor the entire diamond chain: “The Kimberley Process has played an important role over the past decade in resolving conflicts linked to the diamond trade but there is no doubt that it has to be reformed… [by] expanding the definition of conflict to include human rights abuses linked to diamond extraction perpetrated by governments and companies; and expanding downstream monitoring so that the process covers not just the rough diamond trade but also the international movement and polishing of diamonds.”

The statement from South Africa’s civil society groups called on the Kimberley Process to:

  • Exclude Israel from the Kimberley Process Certification Scheme (KPCS) due to Israel’s human rights abuses against the indigenous Palestinians;
  • Expand the Kimberley Process to include cut and polished diamonds in addition to rough diamonds; and
  • End all exports of rough diamonds to Israel immediately.

A member of South Africa’s Boycott, Divestment and Sanctions (BDS) campaign said that a boycott of Israeli “blood diamonds”, and specifically the banning of diamond-polishing in the country, is a win-win solution for all. “Consumers will have a clear conscience that their diamonds are not funding, assisting or in any way involved with the illegal Israeli occupation of Palestine,” insisted Mbuyiseni Ndlozi, “and more jobs will be created locally for our people by bringing this diamond processing back home instead of it being done in Israel.” While opponents of the Israel boycott often try to claim that the boycott will harm South Africans, added Ndlozi, this is a case where it only benefits them.

The Kimberley Process was launched 10 years ago to address the trade in conflict diamonds and to ensure that diamond purchases were not financing violence by rebel movements seeking to undermine legitimate governments. It has 54 participants, representing 90 countries, and its members account for about 99.8 per cent of the global production of rough diamonds. The KPCS is coming under increasing pressure to exclude Israel due to the Israeli government’s involvement in human rights abuses against the Palestinians.

January 12, 2014 Posted by | Ethnic Cleansing, Racism, Zionism, Illegal Occupation, Solidarity and Activism | , , , , | Leave a comment

South African bodies call for Israel to be excluded from diamond processing over ‘war crimes’

RT | June 6, 2013

South African human rights groups, trade unions and major civil society organisations are calling for the Kimberley Process Certification Scheme* to exclude Israel from diamond processing.

The certification scheme is designed to stop ‘conflict diamonds’ from entering the mainstream diamond market and was set up in 2003. The organisation which runs the scheme is currently meeting in South Africa.

The coalition of organisations such as South Africa’s National Union of Mineworkers, the country’s largest trade union federation COSATU; South African Students Congress; the Coalition for a Free Palestine and BDS South Africa say that “billions of dollars’ worth of diamonds exported via Israel are a major source of revenue for the Israeli military, which stands accused of war crimes.”

The coalition is calling for Israel to be excluded from the Kimberley Process Certification Scheme due to its human rights record against Palestinians, and to end all exports of rough diamonds to Israel immediately.

The organizations also wants to ban diamond polishing and cutting in Israel. They claim excluding Israel from the diamond processing would be a great chance for the South African authorities to display “moral vision and political leadership”.

“The Kimberley Process has played an important role over the past decade in resolving conflicts linked to the diamond trade but there is no doubt that it has to be reformed… [by] expanding the definition of conflict to include human rights abuses linked to diamond extraction perpetrated by governments and companies; and expanding downstream monitoring so that the process covers not just the rough diamond trade but also the international movement and polishing of diamonds,” Southern Africa Resource Watch director Claude Kabemba told the Business Day newspaper.

The coalition also pointed to the local benefits of such a move, claiming it could bring more diamond processing jobs back to South Africa. “Consumers will have a clear conscience that their diamonds are not funding, assisting or in any way involved with the illegal Israeli occupation of Palestine, and more jobs will be created locally for our people by bringing this diamond processing back home instead of it being done in Israel,” South African activist Mbuyiseni Ndlozi is quoted by the Middle East Monitor as saying.

The Kimberley Process, established a decade ago to help resolve international diamond trade conflicts and to ensure that the diamond trade is not used as an instrument to fund military rebellions and other violence interfering with human rights. The organization includes 54 participants representing 90 countries while its members account for about 99.8 percent of the global production of rough diamonds, the Middle East Monitor reports.

* The Kimberley Process Certification Scheme (KPCS) is the process to prevent “conflict diamonds” from entering the mainstream rough diamond market. Established by UN GA Resolution 55/56 in 2003, the process is aimed “to ensure that diamond purchases were not financing violence by rebel movements and their allies seeking to undermine legitimate governments.” In order for a country to be a participant, it must ensure that any diamond originating from the country does not finance a rebel group or other entity seeking to overthrow a UN-recognized government, that every diamond export be accompanied by a Kimberley Process certificate and that no diamond is imported from, or exported to, a non-member of the scheme. As of 30 November 2012, there were 54 participants in the KPCS representing 80 countries, with the European Union counting as a single participant.

June 6, 2013 Posted by | Ethnic Cleansing, Racism, Zionism, Solidarity and Activism, War Crimes | , , , , , , , | 1 Comment

“Diamonds Crafted in Israel Should be Banned”

Al-Manar | March 15, 2012

The International diamond-regulatory system, the Kimberley Process Certification Scheme, set up to end the trade in blood diamonds is under pressure to ban diamonds from Israel because human rights activists state they are funding the Israeli military, which stands accused of war crimes and possible crimes against humanity by the UN Human Rights Council.

A statement issued by a coalition of human rights groups including Jews for “Boycotting Israel Goods,” the Alternative Information Centre – a Bethlehem-based Israeli/Palestinian group – and a number of Palestine solidarity groups from Ireland and Britain calls on the new KPSC chair, US Ambassador, Gillian Milovanovic and members of the KPSC to ban the export of diamonds crafted in the Zionist entity.

The groups expressed “great concern about the recent escalation of military attacks by Israeli forces against the defenseless, besieged residents of the Gaza strip which have killed at least 23 Palestinians, including two children.”

“Scores of people have been injured, while thousands more have been terrorized and traumatized. With this horrific backdrop, we believe the time for action is now.  The jewellery industry is facilitating Israeli war crimes by allowing the trade in diamonds from Israel which generates around $1 billion per annum in funding for the Israeli military [1]. The international community must act in a meaningful manner to end Israeli violations of international law; banning the export of Israeli diamonds would be a very important step in that direction,” the Kimberley’s statement read.

The statement calls on jewelers “not to sell diamonds from Israel which should be regarded as blood diamonds and to end the false and grossly misleading practice of claiming that diamonds which fund gross human rights violations by government forces are ‘conflict free’.”

It also called for support for this initiative from other organizations: “We ask human rights groups worldwide to pressure the diamond industry to isolate diamonds processed in Israel and not to allow the legitimate diamond market to be used as an economic shield to fund Israeli apartheid, occupation and war crimes,” the statement concluded.

March 15, 2012 Posted by | Ethnic Cleansing, Racism, Zionism, Illegal Occupation, Solidarity and Activism, Timeless or most popular, War Crimes | , , | 1 Comment