of
our negotiations and ultimate conclusion of provisional agreements was
recognition of Government's policy with regard to protection and
advancement South African cutting industry and maintenance
Government's selling organization. This is now being attacked by
European industry having proclaimed boycott against South African
cutters in the sale of their goods. This Government approached
governments of Holland and Belgium with proposal to return to status quo ante and
negotiate with regard to points of difference between European and
South African industries, which, unfortunately, was not accepted.
Government naturally cannot tolerate such action by overseas cutters
against its own deliberate policy and relies upon co-operation of
Syndicate and Diamond Corporation in upholding fundamental condition
of agreements. Government suggests that the Syndicate and the Diamond
Corporation shall as a preliminary step immediately and effectively cease selling rough diamonds from either South African or other stocks either directly or indirectly to Europe pending more effective measures being taken. Further, Government requires that
the agreements shall provide for measures now being formulated which
will be taken to prevent repetition of similar boycott or any other
hostile action by overseas industry in future. Please reply immediately.
The
Diamond Corporation repudiated both the basic logic of the Government's
cable and the practical measures which it suggested. As regards the
latter,
The
suggestion that this corporation shall cease selling rough diamonds is
quite impractical unless means were found by the Government to prevent
the Union alluvial production from finding its way to Holland and
Belgium, because the brilliants manufactured out of South African
alluvial production —which is practically all shipped to Holland and
Belgium by purchasers other than this corporation—together with the
brilliants manufactured in South Africa which are also sent to those
centres for sale, supply practically the whole present world demand. .
. .
By
the time this letter had been dispatched, Ernest Oppenheimer had
succeeded, if not in solving the problem, at any rate in securing a
breathing space by interviewing the Belgian and Amsterdam parties
involved in the dispute. They agreed to call off the boycott subject to
a conference being called, and subject, also, to South African centres
temporarily 'cutting' the production of brilliants.
But, apart from the fact that the telegram from the Government dated 27 March implied that the agreements previously negotiated
and
Antwerp to force cutters here to conform. Cannot understand why you
attempt to dovetail producers in a trade dispute. We have enough
troubles and anxieties without this. Surely you do not intend to make
reprisals on Union producers in an endeavour to remedy a foreign trade
dispute.'
