Identifier
Created
Classification
Origin
06ABIDJAN1406
2006-12-21 16:15:00
CONFIDENTIAL
Embassy Abidjan
Cable title:  

DIAMOND MINING IN COTE D'IVOIRE'S NORTH-CENTRAL

Tags:  EMIN IV 
pdf how-to read a cable
VZCZCXRO1543
RR RUEHPA
DE RUEHAB #1406/01 3551615
ZNY CCCCC ZZH
R 211615Z DEC 06
FM AMEMBASSY ABIDJAN
TO RUEHC/SECSTATE WASHDC 2343
INFO RUEHZK/ECOWAS COLLECTIVE
C O N F I D E N T I A L SECTION 01 OF 02 ABIDJAN 001406 

SIPDIS

SIPDIS

E.O. 12958: DECL: 12/20/2016
TAGS: EMIN IV
SUBJECT: DIAMOND MINING IN COTE D'IVOIRE'S NORTH-CENTRAL
REGION

Classified By: Economic Officer Erfana Dar Reasons 1.4 (b) & (d)

C O N F I D E N T I A L SECTION 01 OF 02 ABIDJAN 001406

SIPDIS

SIPDIS

E.O. 12958: DECL: 12/20/2016
TAGS: EMIN IV
SUBJECT: DIAMOND MINING IN COTE D'IVOIRE'S NORTH-CENTRAL
REGION

Classified By: Economic Officer Erfana Dar Reasons 1.4 (b) & (d)


1. (C) Summary: In the north-central region of Cote
d'Ivoire near Korhogo, diamonds are mined using traditional
methods of searching riverbeds with sieves. The yield from
this particular region is small--perhaps a few hundred stones
a month collectively--and offers a subsistence living for the
few hundred people who are mining the area. There are a few
small villages southwest of Korhogo within a radius of 50
kilometers of each other that produce relatively small stones
of poor color. Miners are family units who mine the muddy
waters and sell to one of three buyers in Tortiya, a small
town approximately 115 km southwest of Korhogo. The average
income for a mining family per month is about 20,000 CFA (40
USD) for several uncut diamonds of perhaps one carat size.
Despite the fact that extracted diamonds are of lesser
quality, with relatively low market value, a stone bought by
a local middleman for 10,000 CFA (20 USD) will sell for ten
times that price to an intermediate customer (approximately
100,000 CFA or 200 USD) with connections in the international
diamond trade. It is estimated that each month roughly 200
stones are sold. According to sources in the area, the
customer base in Tortiya is small and exclusive, mostly
consisting of Chinese nationals. According to sources, there
was no indication of forced child labor or sexual
exploitation of women. The New Forces (FN) are responsible
for security in the area, and is present largely in the form
of an armed checkpost manned by FN troops, and is widely
assumed that they derive substantial revenue from this
source. There is no coordinating agency or accounting
procedure with which to qualify the gems. End Summary.


2. (C) Diamonds in the Rough: Tortiya is known in the
north-central region southwest of Korhogo as the most notable
location for diamonds. The town itself has few inhabitants
and is frequented by 300-400 migrant miners at a time.
Mining is done by hand in river beds and by family units.
While it is highly labor intensive, there are no signs of
forced child labor or exploited women. According to a report
done for the UN by Major Ashraf Nadeem, a Political/Military
observer posted to Korhogo and photos taken of the area

included in his report, one can see families working in
groups along the riverbed, where children help parents and
conditions do not seem extreme (this evidence is largely
corroborated by the acting mayor of Korhogo, a member of the
RDR (opposition political party with a stronghold in the
north)). There was once a formal diamond mine set up by the
French nearly 30 years ago, but has been abandoned within the
last decade as the significant flow of diamonds has dried up.
Families mine the riverbeds with sieves, earning between
10,000 CFA to 20,000 CFA (20 USD to 40 USD) on average per
month by collectively finding one or perhaps two diamonds of
one carat size, uncut, and of yellowish color.


3. (C) The Local Middlemen: According to Major Nadeem,
miners bring their stones to one of three main buyers in
Tortiya: A French national known as Mr. Marius Sovard, a
Malian immigrant by the name of Little Sieko who has been
settled in Seguela, or a Lebanese national whose name was not
obtained. Mr. Sovard has been in the area for nearly 40
years and also operates a small hotel in the area, from which
he buys and sells the diamonds mined by the migrant families
working the nearby riverbeds. He was very involved in the
diamond trade when it was operated by the French well over 15
years ago, and is considered highly experienced and selective
in purchasing diamonds. The Lebanese merchant is known as a
"wholesale merchant," meaning he purchases fruit and timber
in addition to diamonds and what little gold is mined in the
area as well. However, the most prominent buyer, "Little
Sieko," lives in Seguela and comes to Tortiya every month or
two. He is preferred by most miners as he pays more per
stone and is of the same nationality. He is able to offer
more money because he takes the diamond and makes payment to
the miner only after he has sold it himself. The miner
usually gets his money within four weeks after he has handed
his stones to Little Sieko. Little Sieko has been doing this
trade for nearly twenty years and it is understood he
operates under the protection of the New Forces. He is also
believed to import vehicles primarily from China, and
according to sources in Tortiya, most of his diamond
customers are Chinese nationals who have a sustained business
relationship with him and come to Seguela to purchase his
diamonds. According to a diamond customer, Little Sieko can
sell diamonds for more than ten times the amount he has
agreed to pay for them; for example, customers buying from
Little Sieko pay between 100,000 CFA to 300,000 CFA (200 USD
to 600 USD) for a diamond which is bought by Little Sieko for
between 10,000 (20 USD) to 30,000 CFA (60 USD). According to
photos of the stones, the stones are sold in groups of three
to six, contained in small vials. Post can obtain the photos
which were viewed by Econ officer at the time of the meeting.
Please contact Erfana Dar, (225) 22.49.4602, dares@state.gov

ABIDJAN 00001406 002 OF 002


for further information.


4. (C) Comment: Mining diamonds in the area of Tortiya is
a form of laborious subsistence living for the miners, but
for the middlemen involved with selling the diamonds and the
FN involved with the security of the area, the volume of
diamonds here suggests the overall trade is profitable and
steady enough to likely play a part in the West African rough
diamond trade. It should be noted that this information
pertains only to this small area in north Cote d'Ivoire and
the situation may be different in Seguela and other regions
of the country controlled by the FN (septel). The process
did not appear from photos and sources to be coercive, and
security in the area is well managed by the FN.


5. (C) It can be assumed that the FN are profiting from the
sale and trade of the diamonds in their regions, despite
denials from top FN officials (septel). If a few hundred
people are mining Tortiya and yielding even a couple hundred
small stones each month which are then sold to outside buyers
for perhaps ten times the purchase price, then the result
would be a steady and serious supply of cash. By
conservative estimates, on average roughly 200 diamonds of
various sizes are mined from Tortiya and sold per month. If
the average selling price to the final customer for each
stone is approximately 100,000 CFA (200 USD),this results in
roughly 20,000,000 CFA each month (40,000 USD) in cash
flowing from Tortiya alone. It was not possible to assess
from this visit where exactly the diamonds go after they are
bought in Tortiya, but it is clear that the stones are taken
outside Cote d'Ivoire for sale on the international market,
and it is also apparent that there is a small and familiar
group of customers who are known to do this. According to
sources, it will be difficult for a stranger in Tortiya
without connections to other established clientele to simply
arrange a meeting with Little Seiko and purchase stones for
his private use. Major Nadeem theorized that this
established group of diamond clients take the rough stones to
countries such as Mali or Ghana, where they may be
fraudulently certified via the Kimberly process and then put
for sale on the international market.


6. (C) In all probability profits from these diamonds are
in part funding the FN. Reports by the UNSC have found that
a significant volume of diamonds mined in the FN-held region
are entering the legitimate diamond trade through Ghana and
perhaps Mali. Concurring with published UN reports and
source comment, post believes that in all probability the
majority of diamonds mined in Tortiya are cleared for export
in Ghana with Kimberly Certificates. The lack of controls
and the availability of cheap labor in Tortiya allow these
diamonds to enter the legitimate international market. Since
the UN report was published, Ghana has implemented a working
group to impose tighter controls of diamonds entering and
leaving the country. Mali is not a Kimberly Process
participant, but has expressed interest in joining member
nations and a delegation was sent to the Kimberly Process
annual plenary held in Botswana in November 2006. The FN
denies any involvement in the diamond trade but admits that
residents of the region were free to mine and sell diamonds
to support their families.


7. (C) While the UN resolutions ban the sale of rough
diamonds from Cote d'Ivoire and may be attuned to the serious
humanitarian problems presented by the sale of "blood
diamonds," for the average miner in Tortiya, it is simply a
way o making a living from the river bed which flows an
ebbs, much like the ongoing political situation. End
Comment.
Hooks