How the NGOs Declared War on Dubai (and Vice Versa)

In a speech last week at the Zimbabwe Diamond Conference, Dubai Diamond Exchange chairman Peter Meeus asked, “Why have relations with the NGOs gotten so low?”

One answer: They haven’t. Relations between NGOs and industry groups here in the United States are pretty good, with the factions working together on a host of recent efforts. Even Global Witness, which three years ago quit the Kimberley Process in a much-publicized huff, has been playing a background role lately.

Relations between the NGOs and Dubai, however, are terrible.

Take the jockeying to win the future reins of the Kimberley Process, which is still ongoing at press time. Every year, a participating country becomes chair of the certification scheme. This year, it’s China. Next year it will be Angola, which is currently vice chair, the traditional stepping stone to the big seat. Given that there have been reports of human rights violations in Angola’s diamond fields, many NGOs weren’t crazy about it taking the helm, and blocked the country from the chair spot in the past. This time, they assented, though Partnership Africa Canada’s Alan Martin told me that while there is still plenty to be concerned about in the country, he hopes it can play a constructive role.

Dubai is a different story. One of the most interesting sideshows at this week’s Kimberley Process plenary in Guangzhou, China, was the Civil Society Coalition’s concerted effort to stop the United Arab Emirates’—Dubai’s parent country—bid to become vice chair. On Wednesday, after hearing the speech from a representative of the coalition, a correspondent wrote me from the plenary: “The NGOs more or less declared war on Dubai.” 

Indeed, aside from Zimbabwe—which helped build Dubai as a diamond center and vice versa—it’s hard to think of any diamond region that has become the focus of NGO anger the way Dubai has. And Dubai has given them plenty to complain about. In the speech, Michel Yoboue of Côte d’Ivoire’s GRPIE (Groupe de Recherche et de Plaidoyer sur les Industries Extractives) listed all the issues NGOs see as afflicting it: transfer pricing of African diamonds, poor due diligence, and lax import controls. 

These issues have been aggravated by Meeus’ often-angry public pronouncements, including repeated denunciations of the NGOs so feverish that the former World Diamond Council president called me to dissociate the organization from Meeus’ remarks. While Meeus moans about poor relations with activist groups, he must know he’s the one pouring gasoline on the fire. His Zimbabwe speech is a nearly-20-minute rant against the current villains of Meeus’ world, including the leadership of the World Diamond Council, Partnership Africa Canada, and, bizarrely, the BBC, because of a three-year-old documentary on Zimbabwe, which no one remembers but him. At a time when certain members of the industry are being lectured about the merits of inclusiveness, a country whose public face has called for a Kimberley “divorce” from the NGOs would not exactly be the most inclusive choice.

The enmity is so deep that Yoboue came close to threatening to leave the KP if Dubai took over: “Participants would be ill-advised to ignore our message here today.”

This sparked a search for a last-minute replacement, leading Australia, home of the Argyle mine, to be goaded into running for vice chair. Australia’s candidacy breaks tradition: Generally, a producer alternates with a trading center; Australia heading the scheme would represent back-to-back producers. (Though speaking of back-to-back, if the KP does have two controversial chairs—Angola and UAE—in a row, it would be a bit much.) 

But when members voted today, the tally ended in a deadlock, and because the KP requires absolute consensus, there was no chair-in-waiting chosen due to “no” votes being cast. (It’s safe to say that the “no” votes for Australia from African countries and Russia were shows of support for Dubai.) The ongoing failure to pick a successor chair is a stark reminder of the divisions in the Kimberley Process—and the diamond world in general. And while the situation is not ideal—serving as vice chair is considered a training period for becoming chair—it’s happened before, when the plenary similarly deadlocked in 2010, and the Democratic Republic of Congo went a full year without a deputy the following year.

With all this going on, let’s remember why the KP came about. Many industry members were genuinely disturbed their product could be fueling bloodshed. But the trade also needed to protect the image of its product, and preferred working with NGOs far more than being at perpetual war with them. It hasn’t always worked out the way everyone wanted, but many think the KP saved the business.

And so what do we do with a center that is not only acting in ways that perpetuate the worst notions about our industry, but also makes it a matter of policy to spark a new war with the NGOs? If Meeus’ tirades were part of a strategy to protect the industry’s image by insulating it from criticism, there might be a Machiavellian logic to what he’s doing. But he’s mostly preaching to the choir, the things he’s saying are too overheated to be taken seriously, and he appears more interested in burnishing Dubai’s reputation with African nations hostile to the West than protecting that of the wider industry.

The last point is the most important. Industry members in the consumer centers are constantly being warned: Please consider how policies like chain of custody affect the middle market. Which is fair enough, but let’s flip that proposition: How do antics like Dubai’s impact companies in the consumer markets? With a product as image-based as diamonds, everyone needs to be on their best behavior (“up to diamonds,” as De Beers has it). Sadly, no one is using the words best behavior in conjunction with Dubai with these days.

Even some of the less-NGO-friendly industry members are starting to look at the center as an albatross, albeit one they can’t do much about. A few years back, an executive at a famous retailer told me: “I don’t understand why our industry is supporting Dubai. It will all come back to bite us one day.” That time may have come.

JCK News Director