MAC: Mines and Communities

South Asia Update

Published by MAC on 2006-10-20

South Asia Update

20th October 2006


Critics attack Myanmar's 'blood gem' auctions

Charlotte McDonald-Gibson, Agence France Presse

18th October 2006

It is a long journey from the rocky mines of Myanmar to the toned necks and slender wrists of US celebrities gliding along red carpets.

But with up to 90 percent of the world's rubies and many other precious gems mined in Myanmar, chances are that a vast proportion of the stones glinting in the windows of high-end jewelers worldwide originate in the military-ruled nation.

Hundreds of gems and pieces of jade from Myanmar, formally known as Burma, are due to be sold at auction starting Thursday, and the junta's frequent sales have become an increasingly important source of foreign currency.

But human rights groups and some dealers are urging a boycott, and compare the gems with Africa's so-called blood diamonds which are mined in war zones to finance further violence.

"Buying these gems from Burma, I would say that people are unwittingly supporting the Burmese regime with hard currency ... and pushing Burmese youth to die under great hardship," says Aung Din, policy director for the US Campaign for Burma.

However, some gem dealers and experts dismiss attempts to boycott Myanmar's precious stones as futile and unnecessary, saying it will only push the market into the hands of criminals.

"The stones will go to the black market, it is no different, because of the demand in the market," says Pornchai Chuenchomlada, president of the Thai Gem and Jewelry Traders Association (TGJTA).

Myanmar has been under military rule since 1962. The continued house arrest of democracy leader Aung San Suu Kyi and alleged human rights abuses by the junta prompted the United States and Europe to slap economic sanctions on Myanmar, one of the poorest nations in the world.

But immediately after the United States passed an import ban in 2003, gem dealers began lobbying to circumvent the sanctions, leading to a clause stating that if a gemstone is cut and polished in a third country, it is no longer considered of Myanmar origin.

"That stone is now a legal import into the United States," says Richard Hughes, a US-based gemologist.

Hughes says that all gemstones mined across Myanmar, either by groups controlled by the junta or by private enterprises, are meant to be officially valued by a government committee.

The high quality stones go to auction, where thousands of dealers from the world over gather to bid on lots that include jade, rubies and blue sapphires.

Most bidders are from China and Thailand, says Hughes, who attended an auction in 2004, but they also come from Europe and the United States.

Myanmar's state-run media has said that an auction in July raised 124.2 million dollars. The sale due to take place from October 19-29 could reportedly raise more than 100 million dollars.

While about 95 percent of the jade stays in Asia, the gems are mostly purchased by Thais to be cut and polished be-fore being sold on to dealers and shops abroad.

TGJTA's Pornchai says that for years the black market dominated the trade, but rising oil prices have made mining costlier for smaller illegal operations, and the government has been able to take control of the mines.

"I don't have figures but I believe it is one of the major benefits for the country," he says.

But the idea of buying stones from a military-ruled nation worries some jewelers.

"The fact that virtually every Burmese-origin gemstone offers benefit to one of the most oppressive regimes on the planet made our decision to boycott Burmese gemstones very clear," Brian Leber, a US-based jeweler, tells AFP from his home in Illinois.

One of the highest-profile companies boycotting Myanmar's gems is Tiffany and Co, which stopped selling them in 2003. But Leber says there are still plenty of jewelers who are either ignorant of the situation or turn a blind eye.

"An alarming number are fully aware of the situation in Burma yet are seemingly content to ignore the issue," he says.

Hughes, by contrast, believes the international community should engage with Myanmar's junta rather than pushing it further into isolation.

"These people are paranoid under the best of circumstances and if you start threatening them that only increases their paranoia," he says.

And besides, he says, the gemstones will simply go through neighboring countries and reach the west as Thai gemstones.

"It is not the product that is the problem, it is the politics," he says.

As dealers debate the pros and cons of the trade, human rights groups call for a complete ban on the import of gems from Myanmar's mines.

"A gift of a ruby is meant to symbolize love, but if it comes from Burma the true price is paid in blood and oppression," says Mark Farmaner of Burma Campaign UK.

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