On Chaim Even-Zohar and the DMIA Letter

I generally agree with Chaim Even-Zohar, but his memo about the DMIA’s letter to De Beers struck me as off-base. The comments about foreign aid to Africa may have hit a sour note in some, but really … the letter, which people should read for themselves, does not say that if Americans don’t get sights, then African aid should be reduced. That would, I agree, be horrible. No politician on that list is going to lower African aid at the behest of the unpopular diamond industry (nor should they). The PR implications would be staggering. It is insane to even think about.

I see this as a letter from an industry that is pretty scared right now – and Chaim has been one of the people fanning that fear —  taking action to survive. Clearly, the only pressure the DTC responds to is of the political and/or legal variety, which is the reason we are seeing “beneficiation” in the first place. Thus we see the impressive list of politicians “cc”d at the bottom of the letter. (It does not hurt that one of the Senators representing New York has a pretty good shot of being the next President.) Regardless, at this point, it may be too late for those people to really get involved.

I think most people have a pretty good understanding of the reasons behind – and the need for – beneficiation. For me, the question is: Can the DTC supply both cutters in Africa and New York? Or is it a zero-sum game? None of us really knows but the DTC. However, New York, whose cutters number only in the hundreds at this point, will not require that many supplies. And I would argue that New York manufacturers bring to the table quite a bit in terms of knowledge of the American market, and America is the market the diamond industry is built on. That is what we should be looking at.

One final note: the implication that people who signed the letter are in violation of the BPP is waaaaay over the top. In recent months, the president of Alrosa, Jonathan Oppenheimer and even Chaim have made comments some saw as hostile towards beneficiation. It’s part of open discourse. I am hopeful that the days of “publicly complain about De Beers policies, lose your sight,” are over.

Anyway, the letter was designed to get attention, and it certainly has. I’ve written my reasons why the DTC shouldn’t turn its back on New York here.

By the way, this is my second De Beers-related post today. Check out the first one here.

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