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Angolan Diamonds Still Smuggled Out of Country - 2002-03-27

Angola's state-run diamond buying monopoly concedes high-grade stones are still being smuggled out of the country. The Angola Selling Corporation, called ASCorp, is challenging statistics that suggest the smuggling has increased because independent miners feel the monopoly is cheating them.

ASCorp figures obtained by the Voice of America show the export value of diamonds from Angola's independent miners fell last year by more than $80 million, or 21.7 percent.

The average price per carat for those diamonds fell an even greater amount, 26.3 percent. That is more than $75 per carat compared to 2000.

Industry analysts admit last year was tough for diamond sales and profits because of the economic recession in such key markets as the United States. But they also say the lower prices paid out in Angola cannot be attributed solely to lower global demand.

Instead they contend independent miners are increasingly turning their backs on the state-controlled diamond buying monopoly, originally set up to curb smuggling and other abuses.

The miners, known as garimpeiros, are suspected of moving high-grade stones into the Democratic Republic of Congo and other neighboring countries. There they obtain higher prices and pay lower taxes than in Angola.

Christian Dietrich is a diamond industry analyst who has studied African markets extensively. He tells VOA in a statement: "African diamond miners and dealers do not respond well to monopolies because they always feel they are being cheated, which they are."

An ASCorp spokesman admits independent miners are smuggling diamonds to the Congo and elsewhere. He says Angolan authorities have recognized the need to tighten border controls to stem the flow, estimated by independent monitors at $1-2 million a day.

But the spokesman, Marcus Courage, disputes the suggestion miners are being cheated. In a statement to VOA, Mr. Courage says ASCorp "pays a fair price for diamonds." He says independent miners are reimbursed at rates "which reflect the world market price."

At the same time, the spokesman is challenging the authenticity of the export figures obtained by VOA. He says the state-controlled monopoly has not yet officially published its statistics for 2001. He says the figures are still being collated and reviewed by the firm's auditors.

The data, provided to VOA by industry sources on condition of anonymity, show the overall value of Angola's diamond exports fell last year despite an overall increase in the total number of carats exported.

The figures include not only the output of independent miners, but also the production of Angola's eight major state-controlled mines.

Diamonds are a key ingredient in Angola's export earnings. In the past they also played a central role in fueling the country's civil war, with the UNITA rebel movement selling gems mined from areas under its control to buy arms and ammunition.

In a related development indicating government disenchantment with ASCorp, officials of Angola's ruling MPLA party in the diamond-rich province of Lunda Norte have reportedly accused the monopoly of involvement in illegal diamond trafficking.

According to a document made available to VOA Portuguese Service, the officials accuse ASCorp of certifying individual traders with what are considered dubious pasts, permitting them to move diamonds with little or no government control.

In the document, the local leaders of the Movement for the Popular Liberation of Angola party also complain about a lack of access to mining data and what they consider insufficient royalty income.

ASCorp has had no immediate comment on the charges.