A more formal engagement

For policy makers who wish to prevent military groups from benefiting from mineral resources, a certification process that ensures a “conflict-free” mineral-trading chain is an attractive proposition. The most well-established certification system for the mineral trade, the Kimberley Process Certification Scheme (KPCS), has been in effect since 2003. ¹ Supporters of the KPCS point to the scheme’s success in stemming the flow of “conflict diamonds” by verifying the origin of the gems. ² This chapter argues, however, that the true success of the KPCS lies in two achievements: (1) helping to formalize the international diamond trade at the point of export and (2) providing some rationalization of the sector. By increasing their ability to tax formal trade and exports, formalization and rationalization have assisted the governments of producing countries to strengthen their fiscal link to the diamond trade. Because the achievements associated with the KPCS provide income (and foreign exchange) for often impoverished states, they are important in the context of peacebuilding; but the ability of the KPCS (or similar certificate-of-origin schemes) to prevent armed groups from benefiting from resources remains largely untested.