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 Home / Gem Library / Columns / Sapphires From Madagascar October 31, 2014  

Sapphires From Madagascar
by Uli Rauss
Translation by Astrid-Ann-Roos, SAPHIR-RAUSCH auf Madagaskar
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This story begins about one year ago in Ilakaka, a romantic place on an Island in the Southwest of the Indian Ocean. There, a man found some precious gems and a hundred thousand people descended on it to explore their luck to find more...


The People
Mr.Delorme Mr.Zwetkow Mr.Werner Rashid Solu
Mr.Delorme
Claims to have first discovered gems in the Ilakaka area.
Mr. Zwetkow
Where it is no longer feasible for a person to work, his machines take over.
Mr. Werner
Main gem stone buyer for Multicolour Gems.
Rashid
Suspected nightime robber, and daytime gem dealer.
Solu
Young Digger from Ilakaka. What is in the future for Ilakaka?

The Stones
Blue
Sapphire
Pink
Sapphire
Star
Sapphire
Fancy
Sapphire
Emerald
Blue Sapphire Pink Sapphire Star Sapphire Fancy Sapphire Emerald

and their story

Welcome to Ilakaka
This story begins about one year ago in Ilakaka, a romantic place on an Island in the Southwest of the Indian Ocean. There, a man found some precious gems and a hundred thousand people descended on it to explore their luck to find more.


Werner is flying again in the clouds. Like always, when the dealers and the diggers hear his motor, they stop their work, shake their heads and clap each other on their shoulders with a great jubilation and joy.
Werner means cash to the people working the sapphire mines. Also this time he has three bags full of money on board his Cessna. Altogether there is 650 million Madagascar Francs, nearly 200,000 Deutsch Marks (about USD100,000) and the workers on Ilikaka are desperate for funds. Ilakaka Area - arial view


Seven bodyguards with mirrored sun glasses wait on the back of a Mazda pick-up. The airport, deep in the southwestern desert of Madagascar, is only a wind sock on a bumpy road. Werner lands and gets out of his plane. He looks like a Swiss multi-millionaire. He wears washed out 501 Jeans and worn out sandals. His sweaty hair looks glued to his head like a horse's mane. From out of his scraggly beard he utters, "My God, there are gems everywhere."

Werner Spaltenstein, who is 47 years old, is the son of a local farmer and lives in Zurich. He is the largest shareholder in a company called 'MultiColour Gems, Ltd.', located in Bangkok, Thailand. He buys Madagascar Sapphires for partners in Japan, America, Thailand and Europe. He can buy three, four or sometimes five kilograms for what he considers fair prices. Because he does this regularly the people of Ilakaka love him.

Mr. Werner The Mazda travels quickly over the rough Route 7. Occasionally a local tree called a Satrana Palm comes into view, with its large exposed roots, and one also sees termite mounds, but most of the time all that is visible is the horizon. After some fifteen minutes the silhouettes of the large settlement of Ilakakas come into view. The houses are made of pine and, in the morning sun, they have an ochre shine about them. Excited by the view, Werner says emotionally, "This is like something out of a gold rush, exactly like the wild, wild West."

Some 14 months ago there were 85 people living here in 13 primitive clay huts. Then someone discovered sapphires, blue, green, yellow and colorless precious stones. The news of the discovery spread like wildfire throughout the region. Like a feverish migration, the people swarmed to the source of the sapphires with visions of riches and great luck going through their minds. As of this time, 100,022 wishful miners have registered their activities with the Ilakaka authorities. The town officials estimate that 300,000 optimistic seekers are now living in Ilakaka.


A funny thing is that, of these 300,000, very few know exactly what sapphires are. They are unaware that these gems belong to the Corundum classification group and possess quantities of iron and titanium oxide and that they have a hardness of nine on Moh's scale, which means they are almost as hard as diamonds. Miner with a sieve

That is why they are used to make watch crystals and needles for better record players. Additionally, after you grind the stones they will be equally as bright under all light sources. Prince Charles gave Lady Di a sapphire engagement ring as a symbol for truth and fidelity.

"Sapphires symbolize hope for all of us here" says town official Fernand Rene and he is very happy about the "Ilakaka phenomenon". Every third person in the new city is a businessman while every second one is a miner. He was originally a miner and he says, "Now I have three houses and two Peugeots and can hire miners to work for me."

Whoever came to Ilakaka improved his life in spite of the fact that there was no structure to the city. The dentist's chair was a seat from an old Peugeot, the drill an electric hair curler and the power came from a discarded car battery. Normally, electricity was available only from a generator. There were no hospitals, no sewers, no garbage collection, and no schools. However, there were five nightclubs and a TV Video Cinema called 'Video Santo' where the heroes were Rambo and The Terminator. "More important than anything else there is work to be had", said Fansa Nirina, a young mother who came with her family from the North in November. "Once there was a school in our village but so what! My children earned nothing there."

Young Madagascans with gems "In the beginning new neighbors came every day", her husband said. "In the morning you would go to the mine and in the evening, when you returned home, you wouldn't recognize your way for the new houses."


It is a cool morning. The charcoal cooking fires are smoking. The barefoot miners, their shovels over their shoulders, walk slowly to the mines. One of the biggest mines lies directly next to the tributary of a river. It is a canyon 400 meters long, twelve meters wide and twenty meters deep. A group of eight miners from the Western part of Madagascar are putting their heads together to solve a problem. Their boss owns two mines, each of which is four meters wide. On this occasion he made an agreement with these men to work for three days.

Each man was to earn three Marks a day (about US$1.50). However, this time the men want their money in advance because they hadn't found any gems in more than a week. Their boss had sold the best stones they found during the past three weeks for 800 Marks (about US$ 400) and each member of the team received a bonus of fifty Marks (US$ 25).

It's hot and dry in Ilakaka The men, working from top to bottom, had dug four plateaus in the sandstone, each plateau some seventy centimeters wide. At the bottom of the mine two of the miners, using only their hands, are putting stones into sand filled bags. At each plateau sits a man with his back pressed against the wall.

Every bag, weighing more than fifteen kilograms each, is thrown from plateau to plateau and must be caught by one of the men with his back against the wall. A wrong move can dislodge a man and bring instant death. Officially there have been twenty-four accidents. Unofficially, some seventy-two men have actually fallen to their deaths.

Most of the workers toil in round or square shaped mines about one meter in diameter. About twenty meters under the surface they dig meter long side tunnels and by candle light they fill buckets with sand and gemstones and send them to the surface with ropes. If someone finds what looks like an attractive sapphire vein, only the foreman is allowed down into the hole. One time a miner swallowed a stone and talked about it when he got drunk in the 'Las Vegas Bar'. "He is not drinking anymore", someone laughed, "because cripples cannot drink."

Mining in Ilakaka The men who carry the full bags stagger to the yellow Ilakaka River. Only those who are trusted can work at the place on the river where the contents of the bags are sieved. When a high carat stone glimmers in the water the blue colour is like the sun coming out on a cloudy day and it is suddenly the turn of the waiting hyenas. The brokers who work for the big boss and who pay the workers a monthly stipend wait on the river bank in the hope to be the first person to examine a promising stone.

Five kilometers away many poor people became rich and many rich people became poor during the past few months. On the gate to the sandy entrance of the sapphire mines is written, "Le Comptoir de Saphir". Seventy-two small shops with names like 'Tyson office' or ' Big Boss Sapphire" lie one after the other. In the mean time, Tom Cushman of the 'Allerton Cushman & Co. Precious Stones' closed his jewelry store in Sun Valley, Idaho, USA. His logo now waves over his shop in Ilakaka and on it is written "Maison Blanche" (The White House). "It is a dangerous game here!" Tom says. "Not long ago someone from Sri Lanka made a miscalculation. He bought a stone for US$ 15,000 and when he tried to cut it the stone broke into pieces".


Multicolour buyer Werner Spaltenstein, the Swiss man we met earlier, who has been in the stone business for twenty years, knows the risks of bad buying. He had US$ 90,000 stolen from him in Tanzania and had a gun held to his head in Nairobi. In Johannesburg a couple of knives were held to his neck and in Bangkok he was given knock out drops. Several weeks ago he survived an aircrash of his Cessna in Madagascar.

At this moment Werner is sitting on a wooden bench in deep concentration behind his work table in shop number 57. On his car radio he is listening to Kenny Rogers singing a Country and Western song, "I'm after whatever the other might bring." In front of the Swiss there stand 30 people in a row looking like some kind of a wall. The best positions in the row are sold to the middlemen for US$15. The room smells from sweat.

Millions of Madagascar Francs "Now we can start." Says Werner. The first salesman puts a plastic bag holding eight different colored sapphires on the table. There are a lot of pink and two blue stones. Werner places the stones in a white bowl. He picks up each stone and turns it quickly between his thumb and first finger, holding it in front of a special light looking for inclusions, windows, gas bubbles and cracks. He says, "Deux millions cinq cent" - 2.5 million, 300 dollars." The broker nods "yes". He knows that Werner will only offer the price one time.

Bags of money change hands. Werner's helpers put the stones in a large bag lying under the table. Next customer. Again, pink, one large blue stone with green overtones which can be purchased cheaply in Australia and Northern Madagascar - "cinq cent milles", 80 dollars. Next! One green stone, five grams, a 25 carat stone - Werner says, "No, that's tourmaline." The market for tourmaline is closed. A yellow padparadsha - "good, un million trois cent".

Payment preparations Time passes - the brokers become impatient and begin to push each other. "They know that my money will be gone in thirty minutes." Shop 57 is shaking. The bodyguards punch a thief until he loses consciousness. The police threaten the unruly brokers with their pistols.

In the evenings you can hear the generators in front of the nightclubs. The entrance fee is 10,000 Madagascar francs, more than three Marks, which is no big deal for those having done well during the day. For those who did not do well, it is a luxury. In the club called 'Dera' the middlemen invest their ten per-cent commission in whiskey, which is only sold in bottles. A dealer from Thailand puts a red bank note between a woman's breasts. In front of the club there are some West

Sri Lankan buyers in Ilakaka Africans fighting over a 15 year old girl named Minar. She minces in her high heels in front of a spotlight on a Renault 4, a good luck cigarette dangling from her mouth. A man in a Bob Marley shirt reaches her first. He offers her a 0.2 gram sapphire for her services. His opponent, who wears a Titanic t-shirt, and sports a large knife wins her attention with a 0.4 gram pink sapphire, the equivalent of two carats, and she agrees to go with him for the whole night.


"Quel bordel!!", complains Charles Rasosa, the Minister for Energy and Mining. Ilakaka is a shameful place. But in America, during the time of the goldrush, things were very much the same. "In Ilakaka, everything goes too fast", says Jean Paul Bory, the Minister of the Police. In the future he will put 30 of his best men to work maintaining order and hygiene. Whoever wears a gun has to demonstrate he has a stable life style. This is easier said than done for one of his men, named 'Bombe'. He lives in Room 18 in the Orchid Hotel in Ranohira, about 25 minutes away from Ilakaka by car. Bombe is lying on his bed, holding a bottle of Chivas. Next to him lies a shotgun and in the right pocket of his pants is a Derringer pistol that he calls,"Baby."

Suspected nightime robber Bombe tells his story in the third person. He was once a regular miner. He overheard people talk about sapphires in Ilakaka. At the beginning of September last year he was there. People showed him stones and he bought for ten dollars stones that turned out to be worth ten thousand dollars.

In this manner the regular miner became respected and acquired two Nissan Jeeps, an arsenal of weapons and more than one and a half million dollars. A well trained team of 30 middlemen worked under him in a village where no foreigner was allowed to go. Only this afternoon he had pulled off a dirty deal. "I bought a 100 carat cat's eye for US$ 2,800 and sold it for US$ 20,000. Ask the Doctor."

The doctor lives in the biggest house in Ilakaka. Servants working there keep busy preparing Asian food in the large kitchen. The doctor is a thin Thai man with fluttering eyes and youthful charm. He is a buyer for a company called "World Sapphire". Under his shirt, on his left side near his belt he wears a mobile phone which he uses to keep in touch with Bangok. On his right side he wears a pistol and under his chin there are three black hairs. Each one is five centimeters long. "I never cut them off because they bring me luck.", says the doctor.

Local police The doctor also says, "I buy stones from Bombe and never buy without making a profit." Three minutes later one of the workers brings him a cat's eye that is as big as a woman's thumb. It is baget shaped, and at 20.2 grams is 101 carats. The doctor caresses the stone. "The world market for cat's eyes is not as good as that for sapphires but you can get US$ 1,000 per. Carat. After the stones are cut, even though half of the rough stone is lost, I will earn US$ 30,000 this afternoon", he says.


The biggest profits are to be made selling milky-blue sapphires heavier than ten carats, but only two per-cent of the sapphires from Madagascar are this heavy. To get stones like this requires careful planning. For example, Abdul Rahman Iqbal, alias 'Big Boss', tests stones in Sri Lankan laboratories, and advertises on posters in Ilakaka. His message reads: "Big Boss buys big stones for big money!" After the 160 Kilo man came to the new gem city in November, the prices exploded. Because he has offices in Dubai and New York, money is no problem for him. Up until his arrival the buyers in Madagascar paid only a fifth of the price paid in Sri Lanka for gems of the same quality.

Custom control In Sri Lanka some 2.6 tons of sapphires are extracted from the mines every year. In Madagascar only a fifth of that amount is currently being mined. "However, in the ground in Madagascar lies work for two hundred years," says Eugene Swetkow. He speculates that sapphires lie in layers some 80 to 100 meters down and have to be found by professionals.


Swetkow, a 62 year old prospector with a beard like Hemingway worked as an engineer, in the seventies, for an Anglo American company in Zambia searching for gemstones. Later he worked in the USA, while in socialistic Madagascar, he discovered a source of gold and emeralds. He has a firm here with 250 employees, a ruby mine and, since January, several concessions to look for sapphires.

Swetkow telephoned several friendly ministers from his office, a partner in Hawaii, his wife in Mainzer Vorort Budenheim and the pilot of his new helicopter in London. His office is a four wheel drive vehicle. It is an olive green Hummer turbo diesel built like a tank and weighs more than five tons. It is outfitted with a GPS satellite navigation system, satellite telephone, Kenwood Walkie Talkie and a bed. In this 300,000 Mark vehicle (he owns three of them) sits this Bulgarian born man who holds a German passport. He also owns a floating crane, an automated dirt washer, and a large extractor. Where it is no longer feasible for a person to work, his machines take over.

We also sell gemsWhat is in the future for Ilakaka? "In one and a half years the sapphire boom will reach its high point," says Werner Spaltenstein, the Swiss big buyer. After that the bubble will burst. The rush will be over. The world market prices will fall. Many of the miners will have to return home.

"Others will try to dig deeper," says Eugene Zwetkow. "When they attempt that, many people will surely die." When this period is over he believes the time will come for him to pursue the industrial production of sapphires in a big way.


Until then, these heavenly blue stones will bring fortune to a few people. Musa Mahesa will not be one of them. Local gem dealer He has struggled and sweated in Ilakaka's mines every day for the past six months. When he started he found one stone that he was able to sell to Bombe for US$ 80. After that he found nothing else. He said, "I met a woman who worked one week, found a stone and was able to buy 16 cows, a car and a Singer sewing machine."

Terribly frustrated, the 49 year old is now working as a guard in a mine that belongs to a Frenchman. This way he at least gets two meals a day. He claims he was the first person to find blue, green, yellow and colorless sapphires in Ilakaka.

He didn't realize they were worth anything and gave them to a friend from whom he heard nothing more. "The stones were just lying in a puddle," he says while he sucks on his pipe which has gone out a long time ago. He has a hard time believing in his bad luck.



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