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Thursday, 24 May, 2001, 12:16 GMT 13:16 UK
De Beers pulls out of Angola
Unita rebel
Diamonds have fuelled Angola's civil war
International diamond mining giant De Beers has decided to suspend its investment in prospecting operations in Angola with immediate effect.

A De Beers statement said the company had reached an impasse in negotiations with the Angolan Government.

The company has been working in partnership with the Angolan state diamond company, Endiama under the terms of a contract signed in 1990.

However the new contract lapsed when new legislation governing the diamond industry was introduced in February last year.

No agreement

The De Beers statement said that 14 months after the suspension of the original contract, it had failed to come to a new agreement with the Angolan authorities and had, therefore, decided that its operations in Angola were at present not viable.

Angolan diamond
De Beers invested in the mining of diamonds in Angola
De Beers has contributed both capital investment and the technology needed to prospect in the kimberlite pipes from which diamonds are extracted.

Despite today's announcement, De Beers will be maintaining a presence in Angola and intends to continue talks with the government.

De Beer's decision means an Israeli company, the Leviev Group, has exclusive rights to market Angola's legitimate diamond output.

Rebels in Angola's civil war control many of the country's diamond mines and their campaign has been in part funded by the sale of diamonds.

Since 1998 the United Nations has banned the export of diamonds from rebel sources.

See also:

17 Nov 00 | Africa
Ambushes in Angola
12 Oct 00 | Africa
Angola war 'threatens region'
15 May 00 | Africa
Diamonds: A rebel's best friend
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