giving De Beers control over the other producers by equity ownership of the shares.23'24
The possible conflict of interest between producers and distributors
was met by the formation of the Diamond Corporation, the major interest
in which came into the hands of the southern African producers. This
still left the problem of the 'outside producers' open. It was solved
by the Diamond Corporation entering into purchase agreements with them,
and by the acquisition of share interests in some of them by the Anglo
American Investment Trust, by the Diamond Corporation and by other
companies in the De Beers Group.
The
magnitude of the achievement, objectively considered, speaks for
itself. But it becomes greater still when the whole range of
circumstances is taken into account. Though in the earlier stages
Ernest Oppenheimer had a foothold in the diamond world through his
connexion with one of the member firms of the Diamond Syndicate
(Messrs. Dunkelsbuhler and Company) he was neither a partner in the
firm nor a director of De Beers, the dominating producer in the Union.
Nor was the Anglo American Corporation a member, originally, of the
Diamond Syndicate. Nor was there then, or at any
23 In
the post-war period the Williamson Mine in Tanganyika has similarly
come within the ambit of De Beers: on the sales side, the Diamond
Corporation has entered into agreement with the Soviet Union.
24 The
organization chart in note (22) represents the situation as it was
before the march of political events in Central and West Africa led to
appropriate modifications which are summarized in the chairman's
statement accompanying the annual report for i960, of De Beers
Consolidated Mines. Mr. H. F. Oppenheimer there stated that 'all the
agreements governing the central selling organization, that is to say,
the Diamond Producers' Association agreement, the sales agreements
between the Diamond Corporation and the Congo, Angola, Tanganyika and
West African producers, and the agreements between the Diamond
Producers' Association and the gem and the industrial marketing
companies, expired at the end of the year. The association agreement
and the association's agreement with the Diamond Purchasing and Trading
Company have been renewed for five years, as have the Diamond
Corporation's agreements with the Congo, Angola and Tanganyika
producers. The agreement for the purchase of Russian diamonds has been
extended. In West Africa, the Sierra Leone Government diamond office,
for which we act as managers, is operating entirely satisfactorily and,
last year the Diamond Corporation bought £10,898,000 worth of diamonds
through this channel and, this year, these purchases are continuing to
run at a high level. The renewal of the contract with Sierra Leone
Selection Trust, which produces about 25 per cent of the diamonds mined
in Sierra Leone, is still under discussion. The policy of the
Government of Ghana, which has laid it down that all' diamonds produced
in that country must be sold through the market in Accra, made it
impossible for us to renew our contracts with the Consolidated African
Selection Trust and Akim Concessions. Similar action by the Government
of the Republic of Guinea prevented the continued operation of our
contract with the Societe Guineenne de Recherches et d'Exploitations
Minieres. The Akim and the Guinea contracts dealt with only
comparatively small quantities of diamonds and, of the three contracts
affected by government action in this way, it is only the ConsoUdated
African Selection Trust contract which is of real importance.'
