Koidu Limited has suspended operations and laid off over 1,000 workers due to disputes over wages and conditions. Workers claim they only receive 30% of their actual wages because of an outdated exchange rate. The strike that initiated this conflict began in December 2024 and resumed in March after failed negotiations. The local economy and global diamond supply may be affected going forward.
Koidu Limited, Sierra Leone’s largest diamond mining firm, has officially halted operations, resulting in the layoff of over 1,000 local workers. This drastic decision comes amidst ongoing disputes revolving around wages and working conditions, with workers alleging they are receiving merely 30% of their true wages due to a fixed exchange rate from 2016. Complaints also include inadequate working conditions, such as insufficient access to clean water and sanitation.
The unrest began back in December 2024 when workers first went on strike. Although the strike was temporarily suspended to facilitate negotiations, talks ultimately stalled. This led to renewed strike actions in early March, reflecting a deepening dissatisfaction among employees. Charles Kainessie, president of the Koidu Limited Workers’ Union, noted that only a handful of employees remain at the company’s headquarters in Freetown while the Ministry of Labour confirmed the receipt of mass termination letters impacting over a thousand workers.
Central to the conflict is the company’s salary structure. Kainessie emphasized that workers are essentially being shortchanged, receiving only a fraction of their worth as salaries pegged to the U.S. dollar are compensated in Sierra Leone’s currency at an outdated exchange rate. Workers have voiced legitimate concerns that have not been adequately addressed, notably the poor conditions under which they operate.
The shutdown of Koidu Limited could potentially tighten the already strained global diamond supply chain, especially considering that production cuts from major exporters like India have impacted availability. Industry estimates suggest that Koidu Limited’s annual exports could be around $100 million.
Additionally, the dispute has drawn political attention, notably involving Sierra Leone’s First Lady, Fatima Bio. During a visit to the Kono District in March, she publicly condemned the company’s treatment of its workers as “unjust” via social media, an accusation that Koidu Limited has refuted as misleading. Financially, the company has faced substantial losses—reportedly over $16 million due to the strike—and requires approximately $20 million to resume its operations.
In summary, Koidu Limited’s decision to suspend operations has resulted in significant worker layoffs amidst ongoing disputes concerning wages and working conditions. With workers alleging that they receive substantially less than their actual wages and face inadequate conditions, this situation has escalated from a strike into a broader crisis affecting the diamond supply chain. The involvement of political figures and the financial losses incurred by the company add further complexity to the unfolding events.
Original Source: africa.businessinsider.com
