Despite U.S. and European Union sanctions against the major gem-selling entities in Myanmar, freshly mined Burmese rubies continue to appear on international markets, said a new report by Global Witness.
In February, the democratically elected government in Myanmar (formerly known as Burma) was overthrown in a military coup. In April, the U.S. Treasury’s Office of Foreign Assets Control (OFAC) placed sanctions on Myanma Gems Enterprise, the government entity that controls a majority of the country’s gemstone sales. That effectively banned just about all Burmese rubies from the United States.
But that hasn’t stopped those gems from appearing in stores in America and around the world, Global Witness senior campaigner Clare Hammond tells JCK.
“When sanctions have been imposed, the companies have figured a way to get around them,” says Hammond, who lived in Myanmar for six years. “The gems were just smuggled to Thailand, and their origins weren’t disclosed. The Thai industry is still sourcing from Myanmar, even after the coup.”
The full report, which can be downloaded here, notes that only a handful of companies—including Tiffany & Co., Signet Jewelers, Boodles, Harry Winston, Cartier, and Gübelin—have policies against carrying Burmese rubies. (Harry Winston’s declaration was issued last week.)
The report called upon all actors in the supply chain to practice due diligence measures to ensure they are not sourcing Burmese rubies.
“Thai suppliers are a key point in the supply chain,” she says. “They have long-standing relations with the big players [in Burma]. It would be fantastic if jewelers ask their Thai suppliers to stop sourcing gems from Myanmar.”
Many in the industry have long argued—as they did when the Tom Lantos JADE Act imposed a blanket ban on all Burmese rubies in 2008—that these actions hurt the artisanal miners who depend on gem sales.
“That argument is important in other contexts,” says Hammond. “But in Myanmar, artisanal miners have been systematically exploited and extorted since the coup. They are at serious risk of violence. There has been a lot of violence in the gem-mining areas. We don’t think it’s possible to support artisanal mining in this context.”
The report says that “some miners told us that there were more opportunities now for local people than before the coup, because for the first time in decades they have access (albeit illegally) to lucrative gemstone tracts that were previously licensed to large companies. However, these opportunities are contingent upon paying bribes extorted by soldiers and local officials.… There are serious concerns that [these] extortion payments [fund] human rights abuses.”
Hammond admits that jade is a much bigger moneymaker than rubies, but “it’s a lot of the same actors in both.” Oil and gas contribute far more to the country’s coffers than gems do, but Hammond believes that gems play a role in propping up the current junta.
“One reason Myanmar’s military has held onto power for so long is the country is so rich in gemstones,” she says. “The best way the international community can help is to shut off those sources of financing.”
Doug Hucker, president of the American Gem Trade Association, says that the report “doesn’t include a lot of news that we didn’t know.
“Global Witness is not wrong that it’s very difficult to get gemstones out of Myanmar ethically,” he says. “Most of those big brands have been very cautious about what they do. The trade in Burmese rubies has slowed way, way down because of the sanctions. The whole industry shouldn’t be painted with a broad brush.
“We have done training with our members to help them understand what their responsibilities are under the sanctions. You hope that people are doing their due diligence and asking their suppliers about where they’re sourcing from.”
The report noted that for years, Myanmar was the dominant source for rubies. Since then, ruby production has increased in Mozambique, but the report cast doubt on whether Mozambique should be considered an “ethical alternative.”
In 2019, miner Gemfields paid $7.8 million to settle a lawsuit brought by U.K. law firm Leigh Day representing more than 200 locals in response to alleged human rights abuses at its Montepuez mine in Mozambique.
In a statement, Gemfields acknowledged “instances of violence have occurred on and around the MRM license area, both before and after Gemfields’ arrival in Montepuez.” Gemfields maintained it was not liable for the alleged incidents, but said the settlement was in the best interests of its stakeholders.
While Gemfields told Global Witness that “apart from one journalist’s allegations, it is not aware of allegations of ongoing violence involving [mine] personnel and contractors, and that the company has recently joined the Voluntary Principles on Security and Human Rights.”
Mozambique “was not the focus of this investigation, but we do have more information” about the situation there, Hammond says, which could be the subject of a future Global Witness report.
(Photo: Getty Images)
Source: JCK 16-12-2021
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