Commerce and conflict: Angola & DiamondWorks

By applying a template for risk assessment to the operations of the Canadian company DiamondWorks in Angola during the 1990’s, this report highlights the complex and dynamic interplay of commerce and conflict. Conclusions and observations arising form the analysis are designed to aid businesses returning to Angola in the creation of corporate strategies designed to avoid disrupting the peace process currently underway in Angola.The report identifies a number of high risk factors that characterised the situation in Angola during the 1990’s, and which are still present to some extent today:rentier/corrupt government: Resulting in weak social and economic infrastructure and a lack of accountability and representationmilitarisation of the diamond industry: Resulting in habitual human rights violations and consistent, low intensity conflict punctuated by high intensity periods of warhigh number of refugees and IDPs: Destabilising the country and negatively impacting already deplorable living standards and human developmentunequal distribution of resourcescorporate participation in violence through use of private security organisations.The report highlights that in such a volatile situation, a company can choose from three different ways of operating:they can work around the conflict, by treating the conflict as an impediment or negative externality that is to be avoidedthey can work in the conflict, by developing a risk mitigation approach to business operationsthey can work on the conflict, by which involves conscious attempts by the MNC to conduct business with its’ primary focus on conflict prevention, management, and resolution.With regards to DiamondWorks operations, it can be said that their activities in Angola were largely attempts to work around and in the conflict. DiamondWorks sought to “conflict proof” its operations through the use of private security organisations and personal-use infrastructure. This, however, did not bring about the desired results. For the future companies that want to operate in Angola will have to develop corporate policies that avoid aggravating a still fragile situation.