US embassy cable - 05KINSHASA1149

C O N F I D E N T I A L KINSHASA 001149 
 
SIPDIS 
 
PASS TO USTR; STATE FOR AF/EPS (KWALZ) 
 
E.O. 12958: DECL: 07/14/2015 
TAGS: ECON, EMIN, EINV, CG 
SUBJECT: CEEC PRESENTS RECOMMENDATIONS ON KIMBERLEY PROCESS 
 
Classified By: EconOff W. Brafman for reasons 1.4 b/d. 
 
1.  (U)  Summary.  July 8, the Centre d'Evaluation, 
d'Expertise et de Certification (CEEC), the DRC's mining 
regulatory body, met with various embassies in Kinshasa to 
present recommendations on Kimberley Process implementation. 
Victor Kasongo, the CEO of CEEC, outlined the difficulties of 
implementation in the DRC and in the region. Subsequently, 
CEEC management and technical advisors presented their 
recommendations for the DRC, derived from a Kimberley process 
review visit conducted October 2004.  The paramount 
recommendation was a feasibility study to measure the costs 
of implementation recommendations.  The GDRC demonstrates 
some willingness to comply with the Kimberley Process, but it 
has made little progress in implementation at crucial mining 
stages. End summary. 
 
2.  (U)  Kasongo presented an overview of artisanal mining, 
citing smuggling, unauthorized mining, environmental 
problems, insufficient regulatory framework, and weak 
financial institutions as barriers to Kimberley 
implementation in the DRC.  He said other significant 
obstacles are limited geological data and poor technical, 
management and marketing skills. 
 
3.  (U)  To improve Kimberley implementation, Kasongo 
suggested strong border control and better communication with 
remote diamond areas in the DRC.  He also recommended 
establishing a regional database to share customs information 
and establish formal communication among Central and Southern 
African diamond producers. Restructuring the alluvial diamond 
industry, through land registration and improved licensing, 
infrastructure building, and the establishment of a Diamond 
Marketing Board would also improve Kimberley implementation. 
He emphasized the necessity of creating a transparent 
industry in which bankers and investors are willing to 
invest. Finally, Kasongo called on the international 
community to report its diamond imports to confirm DRC's 
export figures. 
 
4.  (U)  The CEEC management and technical team also 
presented its recommendations for DRC's diamond industry.  In 
response to a request from the EU, the team ranked the need 
for a feasibility study to measure the costs of all 
implementation recommendations as paramount.  However, the EU 
requested a more detailed implementation proposal, including 
a budget, before it can fund CEEC's efforts.  The team also 
recommended that the GDRC increase communication between the 
Minister of Mines and CEEC, improve identification and 
licensing, open 8 provincial Service d'Assistance et 
d'Encadrement du Small Scale Mining (SAESSCAM) offices, 
certify documents of origin, and enhance government capacity. 
 Three regulatory bodies, the Administrator of Mines, 
SAESSCAM and the CEEC, monitor diamond mining and trading. 
 
5.  (C)  The CEEC is showing some willingness to comply with 
the Kimberley Process, though it is unclear whether or not 
real progress has occurred at crucial stages in the mining 
process.  The fact that artisanal mining in isolated areas 
dominates the DRC diamond industry makes regulation 
difficult, particularly given the DRC's infrastructure 
problems.  It is often difficult for regulators to access the 
mines because adequate roads and security are lacking. For 
example, in Kisangani it remains easy to purchase diamonds 
illegally.  A MONUC contact told Econoff that one could 
purchase a liter water bottle full of diamonds from a digger 
for USD 100.  Problems with unauthorized mining persist as 
well.  One American mining concession near Tshikapa has been 
forcibly taken over by an unauthorized company and FARDC 
forces reportedly guard it. 
 
6.  (C)  Comment: Because the DRC's diamond reserves are so 
significant, government regulatory officials operate under 
the belief that the DRC is unlikely to be expelled from the 
Kimberley Process.  As a result, the DRC has implemented few 
recommended measures since the October 2004 Kimberley Process 
review, particularly in the phases from digging through sale 
to the comptoirs.  The international community must continue 
to apply pressure to reform the DRC diamond sector.  End 
Comment. 
MEECE