May 2014
*Featured Image: An artisanal diamond digger in Liberia. He dives into the bottom of a river and grabs as much soil as possible with a hose wrapped around his body to breathe, hoping he can get a piece of diamond, which rarely happens. He continues to do so all day.
1. The Situation of Artisanal Diamond Diggers in Liberia
It is said that, mainly in Africa, there are approximately thirteen million artisanal and small scale diamond diggers (hereinafter referred to as “diggers”) who suffer from poverty as well as human rights abuses around the world (source: World Bank); presumed each digger has an average of five family members or relatives, more than fifty million people are affected.
In 2014 May, prior to the launch of the Self-reliance Project for Artisanal Diamond Diggers, Diamonds for Peace (hereinafter referred to as “DFP”) conducted an initial field visit in order to grasp the situation of diggers in Liberia.
Liberia in Africa
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Sites visited
Weasua and Smith Town in Northwest of Liberia. (Approximately five hours drive from Monrovia, Capital City)
Location of Weasua and Smith Town
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People Interviewed
Diggers as well as relevant people such as officials from Ministry of Lands, Mines and Energy; village chief, youth leader, brokers, and etc…
Key Findings
<Income of digger>
- The level of income can vary for every digger. Although the income can be considerably different from year to year, the common annual income is about USD 100. There was a miner (employer of diggers) who made no money in the previous year. In many cases, those who hire diggers (Miners) are so poor themselves that they often pay diggers only with meals.
- Brokers make more money than miners. Their annual income is about USD 5, 000.
- Both miners as well as brokers pay necessary expenses out of their income, therefore, their take-home-pay is assumed to be even lower.
The road of rural area. The dirt track like this continues endlessly.
Photography DFP, Liberia, 2014 |
<Living Conditions in Mining Communities>
- Road: The road condition to the mining communities is very poor (roads are unpaved and bridges are not built), and it is keeping visitors away. It is very difficult to transport the sick to nearby towns as well as to the Capital. Some die en route.
- Water Sanitation: There are not enough wells. Moreover, the water from the wells is not safe to drink, and it has to be boiled before drinking. Few people own toilets in their residence.
- Hospital: There is no hospital, doctor, nor pharmaceuticals available.
- School: There used to be no school. Locals built one themselves, however, they could not afford to hire teachers. Some of teachers are volunteers.
- Electricity: There is no electrical grid in the area, and very few people own a generator. (Weasua: 0, Smith Town: 2 to 3 generators).
- Literacy/ Mathematical Ability: Most diggers and miners are illiterate. Miners can do basic math.
- Living Conditions in General: People have been mining for generations, but their living conditions have not improved at all.
Group Interview with miners in Weasua
 Photography DFP, Liberia, 2014 |
Weasua
Photography DFP, Liberia, 2014 |
<Situation of Mining>
Mining License:
It takes a long time to renew a mining license in the capital. Miners do not have funds to stay days in the city to wait for their renewal application to be processed.
Equipment:
Miners typically own only shovels. Diamond mining requires heavy equipment to dig deeper.
Pricing of Diamonds:
The selling price of diamonds from miner to broker can be less than the cost of mining the diamond itself.
Reasons:
a) Miners do not know the value of the diamonds they sell. Therefore, miners are forced to sell at brokers’ offer.
b) When miners are unable to support themselves, brokers and dealers/exporters support them. In this case, the amount of money spent to support them is deducted from the price of the diamonds, thus, the selling price becomes less.
Mining:
Miners hire diggers to mine diamonds. Sometimes, miners mine by themselves.
Child Labor:
The number of cases is decreased, but there are mining sites where children mine.
<Mining Cooperative>
Weasua：
Miners in Weasua are not organized.
Reasons:
a) There is no financial resource to register as cooperative.
b) They have low motivation to organize themselves due to negative rumors about cooperatives from Smith Town.
Smith Town:
Miners in Smith Town organized themselves ten years ago when a Russian diamond mining company came into the town. The Russian company operated for a couple of years, but was asked to leave as it did not contribute to the development of the community. The cooperative still exists but has not been active since.
<Request from People Interviewed>
・Investors with goodwill are welcome.
Group interview with miners in Smith Town
 Photography DFP, Liberia, 2014 |
A Mining Site in Smith Town
Photography DFP, Liberia, 2014 |
Currently Liberia produces fewer diamonds compared with other diamond producing countries. Therefore, the revenue from the diamond mining is far smaller than that of other countries, and people are despairing about their lives given very few alternatives to work. More serious than the amount of diamonds to be produced is the issue of profit sharing. The reason for significantly low incomes of miners and diggers can be attributed to how the system of the supply chain for diamonds works.
2. The Supply Chain of Diamonds in Liberia
The diagram below shows the simplified supply chain of diamonds in Liberia.
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Dealers/Exporters receive most profit in this system;
For instance, one dealer/exporter in Monrovia was wealthy enough to own three cars (one Porsche, two Toyotas).
Reasons a large portion of diamond profits flows into dealers/exporters are as follows:
a) Less than 10 dealers/exporters in Liberia are authorized to export diamonds because of strict requirements to register to the government. All diamonds must be exported through them. For these reasons, diamonds produced in Liberia flow into a few dealers/exporters, and therefore, profit for each dealer/exporter becomes larger.
b) Dealers/Exporters know the correct value of diamond gemstones, but miners/employers, as well as brokers, do not have the same level of knowledge as the dealers/exporters; therefore, miners/employers as well as brokers are, in many cases, forced to sell diamonds at the price dealers/exporters offer.
3. The Collaboration with the Government of Liberia
When implementing business or project in a developing country, it is necessary to work closely with its government. Fortunately, for the past few years, Liberian government has been considering organizing mineral resource miners, and requested assistance of DFP. One of basic requirements of fair-trade is to have well organized cooperatives that operate independently as well as democratically. Organizing a cooperative of diggers and miners makes collective bargaining possible, which is otherwise, beyond individual miner’s power; and it enables them to improve unfair conditions that they are now suffering from.
Liberian government is currently unable to hold mere statistics of mining sites, diggers, miners as well as their outputs. Therefore, it is assumed that the government is aiming to hold accurate numbers by organizing miners as well as introducing a registration system, which doing so allows the government to collect tax accurately.
These backgrounds indicate that DFP and Liberian government share a common interest; therefore, DFP is going to move the level of collaboration with them to the next step by discussing details of the project.
Deputy Minister of Ministry of Land, Mines and Energy (right), his staffs and the author (center)
Photography DFP, Liberia, 2014 |
4. Conclusion
The initial field visit proved that the project is highly feasible in Liberia.
Main reasons are as follows:
a) There are mining communities which wish to achieve self-reliance by receiving fair amount of payments for their work, and those communities require assistance in order to achieve it,
b) Liberian government not only aims to organize diggers and miners, but also showed a high level of interest toward fair-trade. Therefore, it is highly probable that the project can be implemented with support from the Liberian government.
Details are to be formulated, and preparations to implement the project are underway.