A girl's best friend no more

Richard West

Kimberley

The nearest thing to pornography in this puritanical country is to be found in the Financial Mail, South Africa's answer to the Economist. In a publication intended for men in the business community, it is startling to see a full-page colour advertise- ment showing a girl barely dressed in what the caption describes as 'a saucy mix'n match camisole, two bras, tanga, G-string and suspender belt, in white, black and pearl'. A few pages later, one finds some still more startling advertisements for gold as an ornament, one showing a man and a woman's hand (the wrists encircled with gold) placed on the woman's neck, the other showing a woman's gold-laden hand gripping her crotch, over a caption: 'Gold, I feel great when I put on a few ounces.'

By contrast, the diamond advertisements are demure, showing only the head,

shoulders and one hand of a girl, whose ear and finger sparkle with gems. The stone on her finger, according to Andre, the adver- tiser, is 'an extraordinary diamond' of 1.02 carat. 'Every diamond is rare,' Andre con- tinues, 'but a diamond of a carat or more is only one in a million. And, like love, becomes more precious with time. A mira- cle among miracles. Born from the earth. Reborn on a woman. The extraordinary Diamond Solitaire. When a man's achieve- ment becomes a woman's good fortune. A diamond is forever.' Gold, as Wagner ex- plained in The Ring cycle, is aphrodisiac; diamonds appeal to a woman's search for security. Diamonds are a girl's best friend.

The Financial Mail, like most of the English-language press, is owned by the Anglo-American Corporation, which owns almost everything in South Africa, starting with gold and diamonds, then other min- ing, agricultural land, brewing, and fac- tories for every conceivable product perhaps even the saucy mix'n match camisole, two bras, tanga, G-string and suspender belt, in white, black and pearl. But gold and diamonds still are the prin- cipal sources of wealth to Anglo-American, a company that is no longer English and never was American, but came to power from the mines of Johannesburg and Kimberley. The virtual monopoly founded by Cecil Rhodes passed into the hands of Sir Ernest Oppenheimer and then to his son, Harry, who last month resigned as chairman of the conglomerate, although keeping control of De Beers, the diamond side of the business.

The Anglo-American Corporation had its origins in the aggressive English and Jewish capitalism which invaded the pastoral land of the Afrikaners, at last pro- voking the Boer War. Until about 30 years ago, most Afrikaners resented the company as a symbol of British Imperialism; the Op- penheimers were caricatured as Hog- genheimers. Indeed, Harry Oppenheimer has always opposed the Nationalists and their apartheid system, first as an MP and now as friend and financier of the Pro- gressive Federal Party. Yet his company makes South Africa viable as a state. Were Anglo-American to collapse, the state of South Africa might collapse in black revolt or invasion; as long as Anglo-American prospers, South Africa has the strength to resist all its enemies. The South Africans are well aware of this. The price of gold and diamonds, and their continued pro- fitability, are matters of constant debate and worry.

For most of the last 15 years it was gold that showed the most spectacular rises and falls in value. Until then, 'the price of gold was fixed, at the insistence of the United States, at $35 an ounce, which most believ- ed was close to its market value. Economists at the time had proved to their own satisfaction that gold had lost its former appeal as a way of protecting wealth in times of war, civil unrest and inflation. The world's two major producers of gold, South Africa and the Soviet Union, chaffed at what they regarded as an artificially low price which made most mines unprofitable — and so did President Charles de Gualle of France, a nation of hoarders of gold in- side the mattress or under the cabbage patch.

France, South Africa and the Soviet Union started a run on gold to the conster- nation of the United • States, whose economy was in trouble because of the Viet- nam war. At last the United States decided to float the price of gold, to put it on sale in the banks and allow it to find its own level. Even in Johannesburg there were many who had no confidence in a demand for gold. 'All the economists had been telling us it was just a barbaric metal under the ground,' a banker told me this week, 'and at first the price went down to below $30. The big shots were terrified. I had predicted that the price would double but I had no idea of what would happen.' The price of gold went up by 10 and 20 times until at the beginning of 1980, it stood at more than $800 an ounce. That was during the Teheran crisis when gold was sought as a hedge, against war or financial collapse.

Wheh gold reached $800 an ounce, it seemed to South Africans that their fortune might last forever. But with a decrease in political tension, and a settlement of the Teheran hostages issue, the price of gold was cut by half — and did not respond to more recent political troubles such as Afghanistan, Poland or Britain's Falklands war. it is still, at the time of writing, only $438 an ounce, which nevertheless is a mighty increase on $35, even allowing for inflation. In the autumn of 1982, the South African government felt obliged to get a loan from the International Monetary Fund; but since then things have cheered up again, with a rise in the sale of Krugerrands, South African gold pieces.

The future of diamonds is not so cheer- ful. Since the development of the Kimberley fields in the 1860s, the chief concern of the miners has been not getting the stones from the earth but keeping control on their distribution. The 'big hole', surrounded by barbed wire and empty beer cans, testifies to the fabled wealth of Kimberley: three and a half tons of diamonds came from the open mine before 1914. There are still five active mines in the Kimberley district, though these may soon be closed, and De Beers have other vastly productive mines in the Transvaal, South West Africa (or Namibia, as it soon may be) and Botswana, a nominally independent country, very much under South African influence.

In Cecil Rhodes's time, the Kimberley miners would readily hang, or at least give a flogging to, anyone guilty of IDB, or 'illicit diamond buying', which put at risk the market value of stones. Today the role of the lynch mob has been assumed by the Central Selling Organisation (CSO), based in London, which over the years has man- aged to keep a monopoly on the distribu- tion and sale of gem and industrial stones. The world's second largest producer of diamonds, the Soviet Union, has always re- mained within the CSO, and its state dia- mond corporation has close though secretive contacts with executives of De Beers — one of whom was spotted a year ago at the Bolshoi Ballet.

The De Beers promotion men even enabl- ed the Soviet Union to unload diamonds on to the US market. After the second world war, when tens of thousands of US soldiers were coming home to marry their sweet- hearts, De Beers employed a New York advertising agency to promote diamond engagement rings: the greater the diamond, the greater the love for the girl. In a recent book, The Diamond Invention, Edward Jay Epstein revealed how N. W. Ayer, the advertising agency, coined and promoted the slogan 'A Diamond is Forever'. All went well until, in the mid-Sixties, the Soviet Union put on the market many thousands of small, less than half a carat diamonds which De Beers were obliged to sell through the CSO.

Accordingly N. W. Ayer started a new campaign to promote small diamonds, stressing 'the importance of quality, colour and cut' over size. Women were encouraged to think that a small diamond could be as perfect as a large diamond. De Beers then dreamed up the 'eternity ring', made up of hundreds of tiny Soviet diamonds which could be sold to an entirely new market of married women. The Soviet Union reciprocated by helping its South African ally. Those African diamond-producing states, like Angola, that now have Marxist governments, have been told by the Soviet Union to stay in the CSO. The London con- sulate of the Republic of Guinea, another pseudo-Marxist state, is actually part of the offices of De Beers. I tried, unsuccessfully, for a visa this year.

If South West Africa, or Namibia, comes under the control of the Soviet-backed Swapo, it should not be assumed that De Beers will lose control of their diamond mines. The threat to De Beers comes not from the Soviet Union, but oddly enough from certain pro-Western countries. The Republic of Zaire, a major diamond pro- ducer, has left the CSO. More worrying still, enormous finds of diamonds were recently made in north-western Australia. This diamond field is mainly owned by Bri-

tain's Rio Tinto-Zinc. Apparently RTZ wanted the diamond production there to be sold through the CSO, but this met with an outcry from Australian politicians.

The intervention of Australia does not worry De Beers so much as the fear that diamonds have lost their glamour. Many nations, for instance the French and Spanish, have never much fancied diamonds. The Princess of Wales is typical of a young generation of women who now prefer other jewels or pearls. Even here in South Africa, women now wear artificial diamonds that are quite indistinguishable from the real thing, but cost only a tenth of the price. But are not diamonds also a piece of valuable property, a woman's insurance against the time when her looks have gone and her lovers have left her? The answer would seem to be no.

A diamond has little value at all except when sold through De Beers. A diamond under a carat in size is literally unsellable, as are stolen diamonds of any size. South Africans have special reason to know this. After the Soweto riots in 1975, some of the white South Africans decided to emigrate to the United States or Europe and, since there were strict exchange controls, many smug- gled out diamonds. They could not sell them for more than a small fraction of what they cost. It seems that diamonds have no intrinsic value, while gold is a fixed and reliable asset. An American has worked out that one ounce of gold would have bought a top quality man's suit in 1776, after the first war, after the second war, and in 1982.

In fact those advertisements in the Finan- cial Mail express the reverse of the truth. It is gold that, like love, becomes more precious with time. A diamond is not forever.