Sierra Leone’s biggest diamond mining company, Koidu Limited, has ceased operations and terminated more than 1,000 employees following months of labor disputes over wages and working conditions.
The shutdown deals a severe blow to the country’s diamond exports, valued at around $100 million annually, and could further strain global diamond supplies already impacted by shortages from major producers like India.
The crisis began in December 2024, when Koidu Limited workers launched a strike, suspending it shortly for negotiations before walking out again in March 2025.
According to Charles Kainessie, president of the Koidu Workers’ Union, employees were receiving only 30% of their actual salaries due to an outdated exchange rate (pegged to the 2016 USD value) and faced unsafe working conditions, including a lack of clean drinking water and proper sanitation.
Sierra Leone’s Labour Ministry confirmed receiving termination notices for over 1,000 workers, leaving only a skeleton staff at the company’s Freetown headquarters. Koidu Limited, a subsidiary of Octea Limited (linked to Israeli billionaire Beny Steinmetz), declined to comment on the allegations, citing legal restrictions.
First Lady Accused of Inflaming Tensions, Mine Threatens Legal Action
The dispute took a political turn when Sierra Leone’s First Lady, Fatima Bio, publicly criticized Koidu Limited during a visit to the mining region, accusing the firm of exploiting workers.
The company retaliated with a legal letter, seen by Reuters, accusing Bio of unlawful interference, defamation, and incitement, and demanding a public apology and $16 million in damages for losses incurred during the strikes.
In a social media post, Bio claimed Koidu had “been unjust to workers for far too long,” while the company insisted her statements were false and damaging. Neither Bio nor her office responded to requests for comment.
The Economic Fallout and Global Diamond Market Impact
Koidu Limited’s director and general counsel, Gustaf Fredrik Bodin, stated that $20 million would be required to resume operations, warning that prolonged closure could devastate Sierra Leone’s mining sector.
The mine’s collapse risks exacerbating global diamond shortages, particularly for industrial and gem-grade stones, as other producers struggle to meet demand.
Sierra Leone’s Information Minister, Chernor Bah, assured that the government is working to resolve the standoff, but with more than 1,000+ jobs lost and millions in revenue at stake, the crisis underscores deeper issues in the country’s mining labor disputes and foreign investment climate.
Why It Matters
The shutdown gives us a look at the volatile relationship between multinational mining firms and local labor forces in resource-rich African nations.
As Koidu Limited weighs legal action and potential restart costs, the incident may deter future mining investment in Sierra Leone—a country still recovering from the economic scars of Ebola and civil war.
For now, the fate of more than 1,000 laid-off workers and the global diamond supply chain hangs in the balance, with negotiations between the company, government, and unions likely to shape Sierra Leone’s mining policy for years to come.
