Sierra Leone's Ministry of Natural Resources said that the value of the country's diamond exports dropped by 20% year-on-year in 2009.



A Reuters report said that precious stones' shipments, which are the country's main source of foreign currency, came to about $79 million in 2009 – a drop from 2008's $99 million.



One of the factors said to impact diamond exports is that fact that the financial crisis caused diamond prices on international markets to decrease, as consumer demand for the precious stones dropped.



Another major factor attributed to the Sierra Leone's diamond exports slump is the decreasing investment in alluvial mining, which has been supported by mostly Lebanese diamond traders; many of whom have had to close their business down due to the global financial slowdown.



Sierra Leone's government introduced a new, 15% export tax on the value of diamonds and gems worth more than $500,000 in December. November saw Freetown raise taxes on diamonds from 5% to 6.5%.



"The drop in diamond exports will continue because neighboring countries have not increased taxes, so smuggling (out of Sierra Leone) has increased," the report quoted a diamond trader in the capital as saying.



"Many of the diamond miners are turning from diamonds to gold... 2010 has just started but I don't believe it will yield much for diamonds in Sierra Leone," he added.