Antwerp Reclaims Turf

RAPAPORT… An international diamond conference was held in Antwerp in October — the first such conference since 2004 — signaling renewed efforts by the city to return to its former position at the center — and top — of the global diamond industry.

A star-studded agenda of speakers at the 2007 Antwerp Diamond Conference included Nobel Prize winner and Columbia University Professor Joseph Stiglitz, HRH Princess Mathilde of Belgium, Liberian President Ellen Johnson-Sirleaf and Live Aid founder and humanitarian Bob Geldof. The two-day conference, which attracted approximately 300 attendees from 40 countries, was organized and hosted by the newly named Antwerp World Diamond Centre (AWDC), a successor to the Antwerp Diamond High Council, known as HRD.

Avi Paz, president of the Tel Aviv bourse, stressed the importance of the conference for Antwerp. “It’s been proven that after such international events, business has always picked up,” said Paz. “The thing is that gathering so many industry people nourishes a lot of opportunities. Let me remind you that while I’m always pleased to see Tel Aviv develop, I must also admit that we need all diamond centers. There are, for example, places and countries that are more difficult for Israeli companies to do business with directly, and it comes in handy for us to be able to work through Antwerp. Several Israeli companies have recently opened subsidiaries in Antwerp. It goes without saying, though, that the police raids in Antwerp do no good to the city’s reputation on the international scale.”

DIAMOND IMPORTANCE

AWDC leaders were pleased with the conference and cited the presence of Princess Mathilde as proof of the importance of the diamond sector to Belgium. Deals reportedly were closed between Antwerp and Russia at the conference and a gala evening party sponsored by ALROSA provided additional networking opportunities. Mickey Weinstock of The Love Diamond elaborated, “The conference is a very practical way of meeting with people from all over the world, and in that sense, it’s already a success.”

In his address, Stiglitz pleaded for the future of Africa, explaining that the continent is undergoing a renaissance in the aftermath of a 40-year post-colonial period that has brought nothing but disappointment for the African people. According to Stiglitz, African nations have come to a state of awareness and realize that it is up to them to decide their own future. His point of view is that what he refers to as “underground assets” must not end up in current expenditures but be converted to aboveground assets, that is, long-term sustainable assets, such as knowledge and education.

The difficulties in making such a conversion were explained by Liberian President Johnson-Sirleaf, who said, “Liberia is richly endowed with natural resources, including not only diamonds, but gold, iron ore, bauxite, timber, rubber and potential offshore oil reserves as well. This high mineral wealth has played a major role in fueling conflict and has generally been a ‘resource curse.’ Revenues accrued from these natural resources have been diverted and used to finance internal conflicts and incite unrest across our borders. Revenues from rough diamonds, in particular, have not contributed to development goals for three key reasons: inadequate policy and legal structures, lack of good governance and a lack of organizational structure at the grassroots level. As a result, the country lags far behind in basic human development. This misuse of the government’s resources has also resulted in the collapse of its physical and governance structures. This overall mismanagement of our mineral revenues at the macrolevel and the exploitative distribution arrangements at the local level have retarded the development process in our country. Furthermore, it has not contributed to the alleviation of the abject poverty that continues to prevail in the mining communities and the country as a whole.”

GELDOF CAUSES CONTROVERSY

Humanitarian and activist Bob Geldof took a critical, combative position toward the diamond industry in his speech at the conference, pointing accusing fingers at everyone in the industry, be it De Beers, governments, diamantaires, Western policy, etc. The climax of his speech was when he explained that European agricultural law provides that a 2.5 euros a day [approximately $3.50] subsidy is to be given for all unnecessary cows, while the Western economies help African countries by paying about 0.5 euros [approximately 70 cents] per individual per annum.

By attacking the industry, Geldof caught the audience’s attention but also alienated some listeners. Some conference attendees even said out loud, “I don’t understand what the AWDC has attempted to do here. They paid this guy 50,000 euros [approximately $70,000] just so he could accuse us of being evil.” The most widespread comment was that Geldof is an idealist, which is not bad per se, but that he does not know the diamond industry well enough to make a judgment it could work with.

Geldof did make an interesting comparison between two cities: Antwerp and London. While Antwerp fears that other diamond centers may be or are jeopardizing its supremacy as the leading diamond center, London in fact has been fearing for a long time that its position as the leading European financial city could be lost in favor of Frankfurt. That fear was so great that it forced everyone to work harder and be more inventive, according to Geldof, and they were successful, since London continues to be not only the financial center of Europe, but probably even of the world.

On a subject closer to the diamond industry, Victor van der Kwast, chief executive officer (CEO) of ABN AMRO, which has been the subject of a six-month takeover battle, told the audience that the “The ABN AMRO takeover [by a consortium led by the Royal Bank of Scotland (RBS)] is unconditional. A new managing board has been announced. Nothing should change for the diamond division, except for the name of the future mother company.” In other words, not to worry, guys, we’ll be there for you even if we change our name. In fact, van der Kwast suggested that with the new projects and restructuring, the international diamond division would be more active than ever.