This article describes a HUGE diamond that was recently found in Africa (really, look at the picture it's enormous). It says that it is a near-flawless gem approaching 500 carats. The company that found it says that "It has the potential to yield one of the largest flawless D color round polished diamonds in history."
So maybe this is just me being culturally, geographically, and socially ignorant, but how do these impoverished countries not make money off of this? I understand the acual miners might not see any money, as I saw in Blood Diamond the movie (further digging my grave of ignorance) however I'm still lost
OK whats my point? The chief executive guy said that there have been diamonds WORSE than this worth 12 million. The article goes on to say that the diamond mine is owned 70 percent by a presumably American-owned company, and 30 by that government. I'm no mathematician, but thirty percent of 12 million is still a good piece of paper. The demand for diamonds are so high that people can sell them really expensive I suppose, but are these American dealers really making this much bank off the diamonds?! If this were the case I would imagine somebody over there would get smart and figure out that they need to sell them for more. Maybe the diamonds are really more scarce than I imagine. Maybe nobody knows better. But then again, maybe I know nothing on the subject. Somebody help me if you know anything about it.
2 comments:
This problem regarding resources in various resource-rich countries has been around for some time. The government does control 30 percent of the profits from diamond mining, but who is to say that money is directly circulated and invested in the economy. The government in many third world countries is corrupt and it is not uncommon for money to disappear over many transactions.
Corruption is NOT the only problem. That is a common misconception.
First of all. 70% to 30% in-and-of itself is a ripoff. There is no way the United States government would allow some Mitsubishi or Volkswagen to come in and make those kinds profits while the US workers and government just stood by with a measly 30%. The problem is lack of resources that the governments have. This can be answered a number of ways. First during colonization of just about all African nations at one point in time, their economies were primarily geared to produce what the colonizing country needed, NOT what the people of that country needed. So the countries already don't know how to produce and provide for it's own people. Then after WWII after Imperial Europe lost it's influence in Africa and Asia they (Europeans) were giving an enormous amount to rebuild by the United States under the Marshall Plan. The "Third World" comparatively were given next to nothing, and I mean RIGHT NEXT TO NOTHING. Add this on top of the fact that before WWII these western nations had a taste of capitalism and some sort of infrastructure, the "Third World" didn't. So when you have governments now in such a vulnerable position, that do not have the the capacity to mine for these diamonds on there own, and they can't tax their people, what would they get from them? So many countries have no choice but to increase FDI and let these foreign companies come in and can exploit them for whatever percent they want because without them the governments do not have the means to acquire the resources themselves. But even this does not tell the whole story. I just don't want people to think "third world" countries are corrupt more than they are. Also before we give them the little pathetic amount of AID we do give them all these rules to follow the western model (many western countries do not follow themselves) and they don't understand what works for one country does not work for them all.
Post a Comment