By Alphonso Toweh

MONROVIA, July 30 (Reuters) - Liberia's government began issuing licenses to artisanal diamond miners and foreign companies on Monday for the first time since a gem-fuelled civil war tore the West African country apart.

Trade in rough diamonds from river beds and mud pits in Liberia and neighbouring Sierra Leone fuelled intertwined wars in the 1990s that were among the most brutal in modern African history, killing a quarter of a million people.

Peace has since returned to both countries and the government of Liberian President Ellen Johnson-Sirleaf, elected in 2005, has set up offices to ensure diamonds are certified under the "Kimberley Process", an industry-led scheme designed to prevent illicit gem sales from conflict areas.

The U.N. Security Council lifted a 6-year ban on Liberian gem exports in May in recognition of the government's moves to stamp out the trade in "blood diamonds".

"Today, we have started the issuing of mineral licenses to diamond dealers, brokers and local as well as international miners in the country," A. Kpandel Fayia, deputy minister for mines and energy, told Reuters in an interview.

"This process started because we have met all the requirements set by the U.N.," he said.

The world body imposed sanctions on Liberian diamond exports during the time of former president Charles Taylor, accusing him of using the profits to support rebels in Sierra Leone.

Taylor is on trial in The Hague for war crimes including instigating murder, rape and terrorism during the Sierra Leone war, in which an estimated 50,000 were killed.

Fayia said around 30,000 Liberians had applied for "class C" licences, given to alluvial miners, while around 15 mining firms had applied for more expensive "class A" and "class B" permits.

"We have companies from all over the world. From Israel, the United States, the UK, South Africa and many countries. This should tell us that we are ready for business," Fayia said.

Diamond dealers in Liberia welcomed the issuing of licenses.

"I am very happy to see this ban lifted ... My wife owns this business and this is what we have been doing for the past 30 years," said Lebanese diamond dealer Slman Osseili.

"Since the ban was imposed, we have not worked at all," he said.

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