The economics of abundance

Ersun Warncke
Primedia Inc

On December 1, 2008 Global Witness released a report entitled A Rough Trade. This report detailed the role of diamond sales in financing Angola's civil war. From this seed the idea of "conflict diamonds" sprouted and grew.

A decade later the more provocatively titled Blood Diamond was released to worldwide audiences. Blood Diamond told the same story, but with Leonardo DiCaprio narrating, managed to reach a slightly larger audience.

Blood Diamond was the icing on the cake for a decade long campaign to create a new differentiating factor in the diamond buying decisions of consumers. With the institution in 2003 of the Kimberly Process, to certify diamonds as not having financed violence, the recognition by consumers of the value of such a diamond was essential.

A Rough Trade quoted diamond industry figures as saying that they were spending $500 million dollars per year buying Angolan diamonds in order to stabilize the market. A decade later, with consumers educated in the value of conflict free diamonds, the market was safe. Diamonds that were not certified by the industry as being "conflict free" were simply eliminated from the market without any costly market stabilization efforts.