The global diamond industry employs some 10 million people directly and indirectly all over the world, including Africa. The vast majority of the world's diamonds come from sources that use the revenues generated by diamonds to aid their national development. Given good governance and appropriate laws, diamonds are a vital source of revenue for building infrastructure and essential social services such as hospitals and schools.
|"For our people, every diamond purchase represents food on the table; better living conditions; better healthcare; safe drinking water; more roads to connect our remote communities and much more."
- President Mogae of Botswana, June 7, 2006
Countries such as Botswana, Namibia and South Africa offer ongoing proof that diamond revenues can create sizeable benefits to the economy in countries where they are sourced. In these countries, diamonds have contributed to funding impressive economic growth and stability. Click on the map to the right to view the GDP for countries in Africa. These benefits are also evident in their rankings on the United Nations Human Development Index (HDI), a comparative measure of poverty, literacy, education, life expectancy, childbirth, and other factors for countries worldwide. Click on the map to the right to view the HDI for countries in Africa.
In June, Liberia's recently democratically elected president, Ellen Johnson Sirleaf, called on delegates at a regional conference on the diamond trade to determine how mining can be used to decrease poverty, fuel economic growth and promote peace in the West African countries of Guinea, Liberia, Sierra Leone and the Ivory Coast.
Global communities broadly accept that the creation of a sustainable future for Africa lies in its ability to develop and maximize its natural resources. Diamonds play a major role in these efforts.
The diamond trade contributes approximately $8.4 billion per year to Africa. Following is a look at the impact diamond revenues have on some African countries' economies:
Diamonds account for 76% of Botswana's export revenue, 45% of the government revenue and 33% of the gross domestic product (GDP). Since the discovery of diamonds in Botswana in 1966, the GDP annual growth rate has averaged 7%. Debswana, a Botswana diamond company, is the largest corporate responsibility contributor to the socio-economic development of Botswana. Botswana has one of the fastest growing economies in the world, due in large part to diamonds. Without the legitimate diamond trade, Botswana would lose approximately $3 billion in revenue per year. This loss would impact everything, from spending on social programs to government investments in the country's infrastructure.
In the country of Namibia, diamonds represent approximately 10% of GDP, 40% of export revenue and 7% of the government's annual revenue. Namdeb, a diamond company in Namibia, is the largest corporate social responsibility contributor to the socio-economic development of Namibia. In 2006, Namibia will produce approximately $700 million dollars of diamonds.
South Africa will produce more than $1.5 billion in diamonds in 2006. Corporate social development projects receive millions of dollars of investments by diamond mining companies in South Africa. The Namaqualand Diamond Fund Trust which invests in community development projects, empowerment and sustainability initiatives received approximately US $4.8 million between March 2005 and March 2006 from the Trans Hex Group, a diamond exploration and mining company. The Fund has received a total of US $37.8 million from the Trans Hex Group since it started operating in 1994.
Other countries like Angola, Tanzania, the Democratic Republic of Congo and Sierra Leone also receive major economic benefits due to revenues from diamonds. For example, former war-torn Sierra Leone exported approximately $142 million worth of diamonds in 2005. These diamond revenue funds are helping to rebuild its infrastructure, health services and education systems.
Canada is the world’s third largest producer of diamonds producing an estimated C$1.5 billion worth of diamonds each year and the diamond mining industry in Canada employs thousands of people both directly and indirectly. Direct benefits will accrue to the federal Canadian government through royalties and business and personal income taxes from diamond mines. For example, Indian and Northern Affairs Canada estimates that over the life of the mines in the Northwest Territories (NWT), the Ekati, Diavik and Snap Lake projects will collectively generate royalties of C$1.6 billion, federal business taxes of C$2.6 billion, territorial taxes of C$1.3 billion, and employee and other business income taxes of C$4.7 billion (2004 estimated figures).
|"A decade ago Canadian diamonds were only a gleam in a prospector’s eye. Today there are three producing mines and two more in development. And the Royal Bank predicts diamonds will bring over 30 billion pounds (almost C$70 billion) to the Canadian economy over the next 25 years."
- Prime Minister Stephen Harper of Canada, July 14, 2006
Across Canada, diamond exploration expenditures involving 123 companies reached C$251 million in 2005, which was primarily spent in the NWT, Nunavut, Saskatchewan, Quebec and Ontario. Between 1991 and 2002, diamond mining contributed C$2.9 billion or 83.3% of the total impact on NWT Gross Domestic Product (GDP). Exploration activities contributed another C$549.4 million or 15.8% of the total GDP.
Between 1998 to 2002, the peak growth period of the diamond industry, diamond exploration accounted for 23% of the total C$2.2 billion spent on exploration in Canada.
Between 1996 and 2002, the two operating diamond mines in NWT (Ekati and Diavik) spent C$3.4 billion on goods and services. Of this total, C$1.9 billion or 57% was with from northern businesses and 28%, or just under C$10 million, was with Aboriginal businesses in the north.
|"The Northwest Territories Industrial Mining Skills Strategy directly opens the door to a wide range of rewarding careers in the mining industry and enables Aboriginal communities to take full advantage of the exciting employment opportunities arising in the NWT's expanding diamond mining industry. The diamond industry has given Aboriginal communities in the North plenty of optimism for the future."
- Honourable Ethel Blondin-Andrew , former Canadian Minister of State (Northern Development), February 3, 2005
The diamond industry provides livelihoods for millions of people around the globe. In southern Africa, for example, more than 38,000 people are directly employed by the diamond industry. In Botswana, the diamond industry is the country's second largest employer. And in South Africa, 28,000 people are employed in mining, sorting, valuing, cutting, polishing, jewelry retail and jewelry manufacture. These employment opportunities allow thousands of Africans to make a salary, obtain healthcare, create a better home environment, provide education for their children and much more. These jobs also supply subsequent indirect employment, expanding the communities around where diamonds are found and offering broader opportunities to the people of the communities.
|"We know that diamonds are a valued source of employment, foreign exchange, tax revenue, new investments and play a positive role in enhancing the overall economic well being of countries and local communities."
- Thabo Mbeki, democratically elected President of South Africa
The diamond industry in Canada directly employs over 5,300 people and indirectly employs over 7,500 people. In fact, between 1991 and 2002, diamond mining generated 74% of the total impact on NWT employment. Exploration activities contributed another 23% of total employment impact. There are three producing diamond mines in the NWT and Nunavut, and one in the construction phase in the NWT. There is one diamond mine being built in Ontario, which will be the province’s first diamond mine.
|"The Victor diamond project is great news for the people of Attawapiskat and the surrounding region. De Beers’ investment here means more than just new jobs. It will provide opportunities for families, local businesses and First Nation communities."
- Ontario Premier Dalton McGuinty, June 2006
In 2002, approximately 15% of total employment in the NWT was related to diamond mine operation and construction – that means more than one in seven NWT residents was working as a result of the diamond mining industry.
The revenues generated from the diamond trade also help build the countries they are in. For example, in 1966, there were only 3 miles of road in Botswana. Today, there are nearly 4,000, as well as a public transportation system. There is now a country-wide digital telephone network in Botswana, consisting of several thousand miles of fiber optic cable. These improvements were paid for, in part, by the revenues generated from the sales of diamonds. Now that travel and communications have improved, the people in Botswana have better access to better employment opportunities, healthcare facilities, schools, and cities. These improvements to the country's infrastructure also pave the way for continued economic opportunity and development in the future.