First of all, congratulations to the 16 Botswana sightholders, some of whom have invested heavily in helping Botswana create a local viable diamond manufacturing sector. It is a pity that there were some recent unfortunate labour relations issues there. These 16 contracts signify what could be the most dramatic change in the diamond industry since the Indians started large scale diamond polishing over 30 years ago. The shift of the diamond trade to Africa will continue, whether it will stay for the long term, I have my doubts.

It is interesting to observe that although diamond polishing in Antwerp has practically disappeared, the trade in both rough and polished continues to maintain its own. Various explanations of this have been given, such as the financial and fiscal infrastructures offered by the diamond banks and the Belgian government, the available pool of talent and other facilities. In the end it boils down to the basic ability to add value and provide service to the trade. As Sir David Brewer, former Lord Mayor of London commented at the recent Antwerp Diamond Conference, the physical execution of the transaction is less relevant to a commercial centre as long as that centre is adding value and providing necessary services.

I was therefore surprised to read the desperate letter sent on November 12th to Varda Shine of the DTC by the Diamond Manufacturers & Importers Association of America. It was copied to Hilary Clinton alongside an array of US VIPs. The size of the Diamond manufacturing industry in America is miniscule both in proportion to the world diamond polishing industry and even to the GDP of Manhattan. Whereas the impact on Botswana's or Namibia's GDP of creating a few thousand jobs is tremendous. Even with its inherent inefficiencies, Southern Africa will cheaper than 47th Street in terms of in price per carat. New York may continue to hold its own with polishing large stones but that is not a reason to stop beneficiation. Furthermore, the quantity of rough the US sightholders receive from the DTC that is actually polished in the US seriously questions the justification for any US sightholders, if that was the pretext for their sights. It would make the pipeline more efficient if rough was always shipped directly to the manufacturing locations, and that would exclude Antwerp as well.

In reality, as long as the US is consuming more than 50% of the world's diamond jewellery output, the role of 47th Street has more relevance going downstream, and not with handling the rough. As long as the consumer wants to buy diamond jewellery, where the sight is delivered or where the stone is polished is irrelevant. Industrial efficiency and value for money are relevant. The DTC has shown 'flexibility' in granting contracts to new US sightholders in Namibia and the US sightholders are also represented in Botswana. True, most of the rough they will receive in Africa has to be polished in Africa and not in the US.

Polishing the African rough in the US could never have been a viable proposition in any case. Even Hilary Clinton's intervention cannot change that.