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Sun 27 Mar 2016 12:32 PM

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UAE to launch scheme 'to regulate diamond pricing'

Country placed at high risk of becoming a conduit for illegal diamond trading

UAE to launch scheme 'to regulate diamond pricing'

The UAE will reportedly launch a scheme aimed at standardising the pricing of rough diamonds under its chairmanship of the Kimberley Process.

The Kimberley Process is a global programme that works to halt the trade in ‘blood diamonds’.

According to The National, the UAE, which chairs the programme, is planning workshops and discussions with Kimberley Process members and other relevant parties to devise an initiative to fight mispricing practices within the diamond trade.

NGOs have claimed this deprives diamond producer countries of vital tax revenue – unlike other commodities, there is no global standardised pricing mechanism for rough diamonds, creating potential for abuse in the supply chain.

PAC (the Partnership of Africa and Canada), one of the organsiations that is leading the global campaign to regulate the diamond industry, has placed the UAE high on its watch list of countries “at risk” of becoming a conduit for illegal diamond trading.

“Geographically, the UAE lies at a crossroads in the world diamond trade,” it states on its website. “Its dual role as a transit hub where diamonds can be revalued – and have their origins disguised – makes Dubai extremely attractive to those seeking to give illegitimate diamonds a new lease on life, or to cheat African producing countries out of taxes which they would otherwise have to pay.”

Kimberley Process chairman Ahmed bin Sulayem this week spoke of the need to clamp down on such practices, The National reported. “We feel that should address all the questions that have been raised and start a dialogue on valuation, and we’re planning to hold workshops to start the process,” he was quoted as saying.

“We need to see whether it’s a UAE issue, or whether it’s an issue with producing countries or if it’s an industry-wide problem, and then come with ideas on how we can tackle the problems.”

Bin Sulayem – who is also the executive chairman of the Dubai Multi Commodities Centre – said the intiaitive would include valuation on studies and assessments of Dubai’s role within the trade.

“No country’s diamond market is perfect, and everyone major diamond centre has its own challenges,”

“I’m not going to point fingers at anyone else, though. Through these studies and workshops we’ll look at where the main issues are and how we can resolve them."

Bin Sulayem reportedly did not say when the initiative would be formally launched – he hinted it was unlikely to be completed before the UAE’s chairmanship of the Kimberley Process ends later this year.

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