In 1992 Zaire was the world's third largest producer of industrial diamonds after Australia, which became the largest producer in 1986, and Botswana, which surpassed Zaire in 1992 because of Zaire's reduced production. In 1984 and 1985, Zaire accounted for nearly 30 percent of world production, dropping to about 26 percent in 1986 as new Australian mine production came on stream. Diamond production occurs in the Kasai-Occidental and Kasai-Oriental regions, mostly around the regional capital of Kasai-Oriental, Mbuji-Mayi, near Tshikapa, and in Lodja, about 300 kilometers north of Mbuji-Mayi. In 1993 there were also reports that diamond deposits had been discovered in Équateur Region, in Haut-Zaïre Region, and in southern Bandundu Region along the Angolan border. Diamond ore in Zaire yields about 6 carats per cubic meter. Although Zaire mines both gem quality and industrial diamonds, 90 percent of production is of industrial quality.

Bakwanga Mining Company (Société Minière de Bakwanga--Miba), the state-owned mining concession in Kasai-Oriental Region, produces much of the country's total export in diamonds, from alluvial deposits near Mbuji-Mayi and from kimberlite deposits. The Miba concession covers 62,000 square kilometers. Miba's production is marketed by a subsidiary of the South African company DeBeers, with whom the government has negotiated a guaranteed price per carat. Thousands of individuals also mine for gold, many of them illegally mining the huge Miba concession, whose perimeters are difficult to patrol.

Because of their value on the international market, diamonds have long been smuggled extensively in Zaire. Diamond smuggling spread quickly in the early 1960s. By the late 1970s, the amount of diamonds smuggled was believed to equal nearly 70 percent of official production (5.5 million carats smuggled official production was almost 8.1 million carats). Smuggling decreased following the legalization of artisanal diamond mining in 1983 and the establishment of official, licensed purchasing counters to buy and market artisanal production official production increased correspondingly. But by 1987 there were already indications that smuggling was once again on the increase, and it soared in the troubled early 1990s.

In the first eleven months of 1991, Miba exported an estimated 9.6 million carats. The artisanal purchasing counters accounted for an additional 7.2 million carats. Actual output was much higher than the official combined total of 16.8 million carats, as a result of extensive large-scale smuggling. Reportedly, many of the smuggled diamonds originate from the artisanal counters, aided by high-level government collusion.

The figures for 1991 diamond exports were lower than the 18 million carats produced in 1990 because of the country's chaotic situation, including factors such as looting and flight out of the country by diamond traders. Zairian diamond production in 1992 was estimated at just 15 million carats. Despite its decline, the diamond industry remains vital to the Zairian economy--and to the Mobutu regime--because it is widely regarded as the country's last307 st remaining source of hard currency. A large portion of Miba's official revenues--US$46.3 million in 1991--are believed to go directly to Mobutu's coffers. Moreover, diamond dealers pay Zaire's central bank 1.5 percent of their official total exports, estimated at US$185 million in 1991. Illicit trade in the 1990s was estimated to be as much as twice the officially recorded transactions, but it was not known how much Mobutu profited from the unregistered diamond trade.

Data as of December 1993