Palestine Summer


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What You Don't Know Can Hurt Someone...

Israel’s blood diamonds
29 March 2010

Every year, consumers the world over unwittingly spend billions of dollars on diamonds crafted in Israel, thereby helping to fund one of the world’s most protracted and contentious conflicts. Most people are unaware that Israel is one of the world’s leading producers of cut and polished diamonds. As diamonds are normally not hallmarked, consumers cannot distinguish an Israeli diamond from one crafted in India, Belgium, South Africa or elsewhere. The global diamond industry and aligned governments, including the EU, have hoodwinked consumers into believing the diamond trade has been cleansed of diamonds that fund human rights abuses, but the facts are startlingly different.

Israel — which stands accused of war crimes, crimes against humanity, ethnic cleansing, genocide, the crime of apartheid, extrajudicial executions within and outside the territory it controls and persistent serious breaches of the Geneva Conventions — is the world’s leading exporter of diamonds (see Figure 1 below). Israeli companies import rough diamonds for cutting and polishing, adding significantly to their value, and export them globally via distribution hubs in Antwerp, London, Hong Kong, New York and Mumbai.

In July 2000, the global diamond industry set up the World Diamond Council (WDC). The WDC was established as a response to public outrage about the use of diamonds to fund bloody conflicts in western African countries and it includes representatives from the World Federation of Diamond Bourses and the International Diamond Manufacturers Association. The council’s ultimate mandate is “the development, implementation and oversight of a tracking system for the export and import of rough diamonds to prevent the exploitation of diamonds for illicit purposes such as war and inhumane acts.” Significantly, the WDC limits its concern about human rights violations to those funded by rough diamonds only.

In 2003, the WDC introduced a system of self-regulation called the Kimberly Process Certification Scheme to stem the flow of “conflict” or “blood diamonds.” In keeping with the limited concerns of the WDC the UN-mandated Kimberly Process adopted a very narrow definition of what constitutes a conflict or blood diamond: “rough diamonds used by rebel movements or their allies to finance conflict aimed at undermining legitimate governments.” As a result of this tight ring-fencing, the much more lucrative trade in cut and polished diamonds avoids the human rights strictures applying to rough diamonds, provided the industry uses only Kimberly Process-compliant rough diamonds. Regardless of the human rights violations and atrocities funded by revenue from the Israeli diamond industry, governments and other vested interests party to the Kimberly Process facilitate the unrestricted access of diamonds crafted in Israel to the multi-billion dollar global diamond market.

The WDC created a web site called to promote the virtues of the industry. It lists 24 facts extolling the benefits of the diamond industry — primarily to India and countries in Africa. Some of the benefits include that an estimated 5 million people have access to appropriate healthcare globally thanks to revenues from diamonds; diamond revenues enable every child in Botswana to receive free education up to the age of 13; the revenue from diamonds is instrumental in the fight against theHIV/AIDS pandemic.

While these facts are laudable the list makes no mention of other less savory facts, including the fact that revenue from the diamond industry in Israel helps fund atrocities and human rights abuses such as the killing, maiming and terrorizing of thousands of innocent men, women and children in Palestine and Lebanon — the sort of atrocities the Kimberly Process is supposed to prevent being funded by revenue from diamonds.

The list of “Diamond Facts” paints a one-sided, positive image of the industry. It implies that the greatest benefits are being felt in some of the poorest nations of the world. But Israel, one of the wealthiest nations, towers over all other countries in terms of the net benefit derived from the diamond industry. The added value to the Israeli economy from the export of diamonds was nearly $10 billion in 2008 (see Figure 2 below).

The WDC website is equally selective when it comes to providing information about which countries are most dependent on diamonds. It explains that Namibia, one of the minor diamond exporting countries in monetary terms, derives 40 percent (Trade Performance HS: Exports of Israel” accessed 25 March 2010) (See Figures 3 and 4). By comparison, the budget for Israel’s Ministry of Defense was $16 billion in 2008.

Revenue from the diamond industry helps fund Israel’s illegal occupation of the Palestinian territories, its brutal subjugation of the Palestinian people and its international network of saboteurs, spies and assassins. None of this is alluded to in theWDC’s “Diamond Facts.”

Contrary to claims by the diamond industry and jewelers that all diamonds are now conflict free, they are not. Israel’s dominant position in the industry means that diamonds crafted in Israel are interspersed globally with diamonds crafted in other countries. Consumers who purchase diamonds that are not laser-inscribed to identify where they were crafted run a significant risk of purchasing a diamond crafted in Israel, thereby helping to fund gross human rights violations. The Kimberly Process Certification Scheme strictures only apply to rough diamonds, thus allowing diamonds crafted in Israel to freely enter the market regardless of the criminal actions of the Israeli government and armed forces. The Kimberly Process is seriously flawed and is being used by the diamond industry and jewelers to pull the wool over consumers’ eyes by telling them that all diamonds are now “conflict free” without explaining the limitations and exactly what that means.

All this is hardly surprising given Israel’s dominant position in the diamond industry. Israel currently chairs the Kimberly Process. The notion of self-regulation by any industry that is intrinsically linked to the violations it purports to want to eliminate is something that neither governments nor the general public should tolerate. It is impossible for the public to have confidence in the diamond industry’s attempt to self-regulate as long as it facilitates the trade in diamonds crafted in Israel, which, if the Kimberly Process applied the same standards to all diamonds, would rightly be classified as blood diamonds and treated accordingly.

Given the failure of Western governments to hold Israel to account for numerous breaches of international law including international humanitarian law, breaches of theUN Charter, its failure to abide by more than 30 binding UN Security Council Resolutions, breaches of EU Agreements and disregard for the 2004 advisory opinion of the International Court of Justice, they are unlikely to insist that the diamond industry broaden the definition of a conflict diamond to include cut and polished diamonds that fund human rights abuses.

Consumers should have the right to know where a diamond was crafted and consequently the right to choose an Israel-free diamond. These rights are not available to consumers today.

In 2005, Palestinian civil society called for an international campaign of boycott, divestment and sanctions (BDS) against Israel similar to that which helped bring an end to the apartheid regime in South Africa. The international BDS campaign has to date focused much of its boycott activities on the most easily targeted Israeli products including fruit, vegetable, cosmetics and some plastic products. Targeting these products helps to increase public awareness of Israeli crimes and to some extent satisfies the public’s desire to register disapproval of Israel’s actions. However, these products account for only a small fraction of Israel’s total manufacturing exports. Even if the boycott of these products was totally successful it would not make a significant difference to the Israeli economy or to Israel’s ability to further its expansionist goals.

The diamond industry is a major pillar of the Israeli economy (see Figure 5 above). No other developed country is so heavily dependent on a single luxury commodity and the goodwill of individual consumers globally. Anything that threatens the carefully-nurtured image of diamonds as objects of desire, romance and purity could have serious consequences for the Israel diamond industry and the country’s ability to continue funding its illegal occupation of the Palestinian territories, the construction of illegal colonies and other associated criminal activities that render it the pariah of the modern age.

The international BDS campaign needs to focus global attention on the diamond trade that facilitates Israel’s ongoing crimes against the Palestinian people and its neighbors in the region.

Seán Clinton is the chairperson of the Limerick branch of the Ireland Palestine Solidarity Campaign and a former Boycott Officer on the National Committee of theIreland Palestine Solidarity Campaign.

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OpEdNews Op Eds 4/9/2013 at 10:06:26

A year ago, as a result of a major fraud investigation, the Israeli diamond industry teetered on the brink of collapse and threatened to plunge the Israeli economy into a disastrous tail-spin.

In a clear example of the dangerous over-reliance of the Israeli economy on diamonds and the power of the Israeli diamond industry, an investigation by police and tax authorities into an illegal bank operating in the Israeli Diamond Exchange, involving fraudulent trading worth billions of shekels, was shut down, covered up and silenced to protect the diamond industry - one of the " cornerstones of the Israeli economy".  

Israeli Diamond Exchange, Ramat Gan by Sean Clinton

The orchestration of the media silence which facilitated this cover-up of a criminal scandal has only recently been divulged by Yair Sahar, president of the Israeli Diamond Exchange, in a remarkably open interview with Michelle Moshelian of the Israeli Diamond Institute.

The story first broke on 8th January 2012 when Israeli media reported (12,) that police and tax authority investigators arrested 16 people and raided their homes and offices in the Israeli Diamond Exchange . The reports indicated that police had secretly monitored the activities of the group for over a year and discovered the operation of an illegal bank that offered loans, money transfers and currency exchanges which were not reported to tax authorities in Israel or abroad.

Apart from reports on an Azerbaijani news website "World's largest illegal bank unmasked" and the website of an Indian jewellery magazine which refers to a Globes report (which may have been deleted), very few, if any, other English-language media reported this major crime story that ensnared the Israeli diamond industry and threatened the Israeli economy.

The silence was broken on February 9th 2012 when a report in Haaretz detailed the devastating impact the police investigation was having on the Israeli diamond industry. According to the report, the industry suffered a 70% drop in business in January and the entire sector had been thrown into turmoil resulting in a number of diamond firms going bankrupt leaving $30 million in unpaid debts.

Moti Ganz, the former president of the Israeli Diamond Manufacturers Association,   is quoted as saying:   "the investigation has ruined the industry. The import of raw material has collapsed, and if there is no raw material now then in another three or four months there will also not be any exports of polished diamonds."

The media silence resumed again until February 23rd 2012 when Rappaport reported that Israeli authorities had agreed to suspend the investigation for one month.   A member of the Israeli Diamond Exchange, who requested anonymity, stated that a professional team would be established to "negotiate a suitable solution to the affair."  

But at that stage the damage was done and confidence in the Israeli diamond industry was severely eroded.   As a result, Israel's polished diamond exports dropped 81 percent year on year in February 2012.

Instead of following procedures normally adhered to in a criminal investigation where evidence is collated and presented before a judge and jury and, if found guilty, the perpetrators of a crime are punished in open court, the Israeli authorities agreed to suspend the investigation and negotiate a deal with representatives from the Israeli Diamond Exchange.

In the interview for the Israeli Diamond Institute Yair Sahar describes the fraud investigation as " an earthquake that threatened to topple everything that has been built here over decades".    

Recognising the seriousness of the situation and the vulnerability of the Israeli diamond industry, leaders of the sector met in an emergency meeting and immediately set up a steering committee to control and manage the crisis.

In order to avoid adverse publicity "of events that we could not control" Sahar said the steering committee decided "not to address the press" and, without giving details of how the Israeli media was gagged, they "managed to achieve "media silence" which meant no media outlet publicising the police actions, and very little publication of the events'.

In an unprecedented move, the steering committee sent a delegation to meet directly with the commanders of the investigation to explain "the massive effect the investigation was having on the entire industry."

The delegation outlined "the centrality of the diamond industry to the Israeli economy". Quoting a   turnover of $28 billion,   exports of $11 billion, employing 20,000 people and responsible for supporting 100,000 men, women and children as well as employing 35,000 people abroad and other impressive statistics the delegation outlined the status of the diamond industry in the State of Israel and in the world of diamonds.

Seemingly oblivious to the discrimination of the diamond industry against non-Jewish citizens of the State of Israel, who, according to statistics from the Israeli Central Statistics Office, are grossly underrepresented in employment by the diamond industry, Sahar told the police commanders that their industry "has never caused harm to even the smallest person in the State of Israel".

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A human rights activists from Ireland with a particular interest in the Israeli/Palestinian conflict and the global trade in diamonds which are a major source of funding for the Israeli military regime.

Describing it as an "outstanding accomplishment" Sahar said the police told them they had never before "agreed to listen to the point of view of an industry while that very industry was being investigated". He said he felt their words had "penetrated the hearts of the police officers" who were surprised by the industry's "high level of vulnerability".   As a result, the police authority agreed to suspend the investigation for a month.   

Following the meeting with police commanders a delegation from the diamond industry, headed by Yair Sahar, met with the head of the investigation Unit of the Tax Authority and made the same case, outlining the importance of the diamond industry to the Israeli economy and its vulnerability. Sahar said " The Tax Authority were convinced of the might and the importance of the industry, and they told us that they have no interest in harming the Israeli diamond industry." Consequently, the Tax Authority "promised there would be no more investigations and raids on the diamond offices".

In Western countries blighted by financial scandals the term "too big to fail" has been applied to banks that have been bailed out and saved from bankruptcy by governments. In Israel, the diamond industry is of such critical importance to the Israeli economy, and arguably to the entire Zionist project in Palestine, that authorities believe it is too important to allow a criminal investigation to undermine its status and confidence in industry.

Israel's Top 30 Exports 2008 by Sean Clinton

The Israeli diamond industry accounts for about 30% of Israel's manufacturing exports, worth$21 billion in 2011, adding $11 billion NET to the Israeli economy. If confidence in the Israeli diamond industry is damaged the economic, social and political fallout would be significant as would be the impact on Israel's ability to fund the illegal occupations of Palestinian and Syrian territories.

As a result of the fraud investigation Israel's diamond exports declined by 23% in 2012. In January this year it was reported that Israel would have to cut defense spending in order to stay within a targeted budget deficit of 3% of economic output. When Israel's diamond exports are damaged the financial burden of the occupation is increased proportionately.  

Leaders of the Israeli diamond industry are clearly able to wield significant influence with the police and taxation authorities in Israel. They persuaded the authorities to suspend the fraud investigation and manage the situation in a way that would minimise impact on their industry.   They did so without having to use what Yair Sahar described as "the direct close contacts that the industry management has with the most highly-ranked politicians."  

While the leaders of the Israeli diamond industry wield considerable influence in Israel they do not have the same power to influence consumer confidence in the ethical provenance of the Israeli diamonds. The fact that revenue from their industry provides about $1 billion annuallyfor the Israeli military and security industry - a military which stands accused of war crimes by the UN Human Rights Council, Amnesty International and Human Rights Watch - means their diamonds are funding war crimes and should, therefore, be regarded as blood diamonds. 

These facts have largely been concealed from the diamond-buying public. Israel's influence in the global diamond industry, alluded to by Sahar, ensured that cut and polished diamonds which fund human rights violations by government forces evade the human rights standards applied to rough diamonds by the Kimberley Process (KP). The KP is supposed to prevent the trade in blood diamonds, but, despite the spin from the diamond industry and vested governments, including the EU, it has spectacularly failed to do so. Instead, the KP is a major marketing tool for cut and polished blood diamonds which jewellers deceitfully claim are conflict-free.

The Israeli diamond industry is clearly a very important component of the Israeli economy. The industry has demonstrated that it has significant influence in the upper echelons of Israeli society - with decision makers and with leading politicians.

If they can use that influence to curtail a major fraud investigation they can also use their influence with Israel's political elite and speak out against Israeli government policy which supports the illegal occupations and facilitates gross human rights violations by the Israeli military.

In this respect the global diamond industry and jewellers worldwide also have a role to play in persuading the Israeli diamond industry to impress upon political leaders in Israel the potentially devastating impact of a consumer backlash against diamonds that fund the Israeli military regime. 

In the last year leading diamond companies, including De Beers and Sotheby's, have been targeted by human rights activists who have exposed links between their diamonds and Israeli war crimes in Gaza.

In recent months, over 50 Palestinian organisations, representing a cross-section of Palestinian civil society, including women's groups and trade unions, and international organisations in solidarity with the Palestinian struggle for equality, justice and an end to the Israeli occupation of Palestine, have issued an appeal to women and men of conscience and jewellers worldwide to reject diamonds processed in Israel.

With South Africa chairing the Kimberley Process in 2013 and the African National Congress having given their support for the international BDS (boycott, divestment and sanctions) campaign against Israel until it respects Palestinian rights and international laws, there is considerable scope for South African to use it's influence to increase pressure on Israel.

By supporting calls for cut and polished blood diamonds to be banned by the KP and by ending the export of South African rough diamonds to Israel, South Africa can play an important role in helping to rid the world of an apartheid regime which many prominent South Africans have described as worse than anything they endured during the apartheid era in South Africa.

The group with the most influence are diamond-purchasers. They can send a message to jewellers and the global diamond industry by refusing to purchase diamonds until the industry ends the trade in diamonds that fund rogue regimes guilty of gross human rights violations.

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A human rights activists from Ireland with a particular interest in the Israeli/Palestinian conflict and the global trade in diamonds which are a major source of funding for the Israeli military regime.

Diamond industry spin conceals on-going trade in Blood DiamondsBy Seán Clinton

A recent statement by Ms. Gillian Milovanovic, the out-going US chair of the discredited Kimberley Process Certification Scheme, to the UN General Assembly paints a distorted picture of the system that has failed to end the trade in diamonds that fund gross human-rights violations.

Her statement came at the end of her year as chair of the Kimberley Process (KP), during which efforts to broaden the KP definition of a "conflict diamond" to ban trade in blood diamonds that fund human-rights violations by rogue governments ended in failure - but you wouldn't get any hint of that from her statement to the General Assembly.

Although her report was supposed to deal with "the role of diamonds in fuelling conflict" she restricted her comments to the role of "conflict diamonds" -- the narrowly defined category of blood diamonds that fund rebel groups engaged in conflict against legitimate governments. By focusing solely on "conflict diamonds" the chair of the KP evaded dealing with the issue of diamonds that fund human-rights violations by government forces in Israel and Zimbabwe. These blood diamonds evade the strictures of KP and are allowed to contaminate the global market labelled as conflict-free diamonds. 

Blood diamonds fund war crimes by Sean Clinton

Although the KP was shown to be unfit for purpose in November 2011 when diamonds from the Marange area of Zimbabwe were granted KP certification and allowed on to the international market despite evidence of human-rights violations by Zimbabwean government forces, the KP has failed to introduce the reforms necessary to prevent the on-going trade in blood diamonds that fund rogue governments.

Instead of raising its standards to close off the loophole, the KP now accepts that the standards of the Zimbabwean government, which stands accused of killing 200 miners in the brutal take-over of Marange diamond mines, is the benchmark for Kimberley Process accreditation.  

In keeping with the line taken by the EU High Representative Catherine Ashton following the KP Plenary in Washington (see here), the EU representative to the UN, Americo Beviglia Zampetticlaimed it was a testimony to the KP's ability to resolve situations of non-compliance.  

The fact that diamonds that fund human-rights violations by governments are fully compliant with the KP standards makes a mockery of the Kimberley Process. The KP chair's false portrayal of the KP system as an effective mechanism to prevent the trade in diamonds that fund conflict was a brazen affront to the members of the General Assembly who have been hoodwinked by the conflation of "conflict diamonds" and blood diamonds even though the former definition only applies to rough diamonds used by rebels whereas the later includes all diamonds that fund human-rights violations.     

Ms. Milovanovic's statement ignored the fact that diamonds are a major source of funding for the Israeli military regime that just weeks earlier dropped thousands of tons of high explosives on the defenseless, besieged residents of Gaza, killing 170 Palestinians, mostly civilians, including at least 33 children. During the course of the eight-day assault Israel deliberately targeted and killed journalists -- war crimes that have been documented by Human Rights Watch.

Revenue from the Israeli diamond industry also funds illegal Israeli settlements on Palestinian land in the West Bank and East Jerusalem -- another war crime that Israel brazenly commits in defiance of the will of the international community.

Emboldened by its veto in the Kimberley Process, Israel acts with impunity, safe in the knowledge that its diamond industry, which generates over $1 billion/yr. of revenue used to fund its war crimes, cannot be sanctioned by the Kimberley Process.

Despite these obvious human-rights violations by a leading KP member, the US chair of the KP made no reference to these diamond-funded war crimes in her address the General Assembly. One can imagine how different her report would have been if Iran, rather than Israel, was the source of a large percentage of the world's cut and polished diamonds.

The Kimberley Process system of self regulation, set-up and administered by vested interests, should be scrapped and replaced by international laws that prevent the trade in all diamonds that generate revenue used to fund human-rights violations. The diamond industry has shown that it cannot be trusted to self-regulate. Dominant players in the industry are some of the worst human-rights offenders and have the power of veto over any reforms.   Rather than preventing trade in blood diamonds, the Kimberley Process facilitates the trade and provides an economic shield for rogue governments that profit from consumers' lack of awareness of the extent to which blood diamonds are contaminating the global market.  

However, increasing numbers of consumers are learning about the weaknesses of the Kimberley Process and how easily it can be circumvented. More and more articles are exposing the fact that a large percentage of the diamond on the market are blood diamonds that fund human-rights violations.  

Former South African Ambassador to Washington, DC, Ambassador Welile Nhlapo took over the chair of the Kimberley Process at the beginning of January. Reform of the KP definition of a conflict diamond remains the most important issue on the KP agenda in 2013. But the fact that reform can only come about with the consensus of all KP members means there is zero chance the KP will ban diamonds that fund human-rights violations by government forces.   The trade in "conflict diamonds" may have been curtailed but the trade in blood diamonds continues.  

The diamond industry believes it can dictate what is and is not a blood diamond and that consumers will continue to believe whatever lies they spin without question. Increasing public awareness of the role diamonds play in funding Israeli human rights violations against the Palestinian people could result in a much more honest and open report from the South African chair of the Kimberley Process when he reports to the sixty-eighth session of the UN General Assembly at the end of 2013.

If his report deals with "the role of diamond in fuelling conflict", as requested by the UN General Assembly, then the trade in diamonds that generate revenue used to fund a nuclear-armed belligerent regime accused of war crimes and possible crimes against humanity by the UN Human Rights Council will have to be addressed in his report.

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A human rights activists from Ireland with a particular interest in the Israeli/Palestinian conflict and the global trade in diamonds which are a major source of funding for the Israeli military regime.


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