cerned, and which, therefore, constituted the greatest danger to the diamond trade.
We
kept also in the closest touch with developments in Namaqualand and
acquired some interests there, both in Mr. Ronaldson's concern and in
the very rich discovery at Alexander Bay. All information at our
disposal has, as in the case of Lichtenburg, been made available to the
De Beers company.
The
diamond trade is passing through a very serious crisis which differs
from all past depressions in the trade in that the cause is not a
depression in 'world trade' but an over-production of diamonds. In my
opinion the problem facing the trade can only be solved by a single
institution tackling the various problems instead of several as at
present. De Beers is to my mind the one institution that should take
the lead. I suggested, therefore, to Mr. Joel that the time had come
when we should come to an arrangement with De Beers company, under
which De Beers would take over our various diamond interests, and take
the lead in all diamond matters in future, our organizations giving
every possible assistance. In pursuance of this policy, I suggested to
Mr. Joel that De Beers should acquire his Jagersfontein holding, our
holding in the Consolidated Diamond Mines of South West Africa Limited,
and our joint Lichtenburg and Port Nolloth interests. All these
concerns would then become subsidiaries of De Beers and the control of
all important productions in the Union and South West would pass to De
Beers. Mr. Joel has cabled to me to submit my ideas to the board which
I hereby do. In the same cable he also told me that our colleagues in
London do not approve of the acquisition of the Jagersfontein and South
West Africa interests but are in favour of acquiring the Lichtenburg
and Port Nolloth interests. I am fully convinced that this partial deal
will not help to restore that absolute confidence in diamonds which is
so essential if the trade is to be put on a sound basis, while I
believe that the bigger deal will result in an immediate improvement.
It
would be absurd to think that De Beers would take over our Lichtenburg
and Port Nolloth interests unless it were clearly understood that in
future all new diamond mining interests—whether they be alluvial leases
or participation in new discoveries—would be offered by us to De Beers
or acquired by us (if asked to) on their behalf. Clearly the Anglo
American Corporation would by such an arrangement he put into a
subordinate position to De Beers as far as diamonds are concerned, and
I submit that I cannot reasonably ask the Anglo American board or our
shareholders to make that sacrifice unless all our diamond interests
are taken over hy De Beers, preferably for De Beers shares.
If my colleagues want to discuss the position further please let me know.
In
fairness to me, however, before any discussions take place, some
explanation should be vouchsafed to me for the extraordinary exchange
of cables between Kimberley and the London transfer office throwing
doubt on my loyalty to De Beers, which were embodied in your letter to
me.
