What is the history of the South African Jewish diamond industry?
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The story goes that in 1867 a 15-year-old farm boy, Erasmus Jacobs, picked up a “mooi klippie” (a nice stone) on the banks of the Orange River in the Hopetown district of South Africa’s Northern Cape. He gave it to the farm’s owner who had it authenticated as a diamond by the leading minerals expert of the time.
News soon spread and there was a great deal of excitement about the possibility of finding diamonds in South Africa. The British Governor of the Cape Colony, George Grey, exclaimed: “This is the stone on which the future of this country rests.”
But the Royal Museum of Geology in London insisted it was a fake that had been planted on the bare veld. A British geologist went on record as saying, “The soil in South Africa would certainly not hold diamonds.” He was prepared to stake his reputation on it.
Despite his cynicism the 21.5 carat stone became “The Eureka” – the “Star of South Africa” – and ushered in a worldwide diamond rush. (To give an indication of its size, most people walk around with diamonds of less than a carat in their personal jewelry).
Fortune-seekers with big dreams, mostly from Britain and Germany, arrived near a town now called Kimberley. Whereas some would dig up a fortune; others dug their graves. Originally, massive diamond deposits were found in sand and gravel around rivers, but the practice of dry diggings soon led to deeper mining, and later still, to marine sources.
After the initial discoveries, syndicates and partnerships were set up. A prominent name was Barney Barnato, a Jew from England; others were German Jews like Alfred Beit and Ernest Oppenheimer, the latter of whom bought two farms owned by Johannes and Diedrik De Beer (the De Beer brothers). Cecil John Rhodes, who later became prime minister of the Cape Colony, joined Barnato, Beit (and F. Philipson-Stow) and together they developed De Beers Consolidated Mines which would become the world’s largest diamond company.
They were strongly in favor of the Diamond Trade Act (1882) that made it a severely punishable offense for anyone but a licensed buyer to be in possession of rough diamonds. It followed that they were firmly against a diamond cutting industry being set up as they believed that all stolen diamonds could be processed and escape the laws of possessing uncut diamonds.
But this led to general dissatisfaction amongst diamond dealers who were restricted from trading in South Africa for this reason. Many had made money by trading in rough diamonds bought from diggers and now they could only deal in polished diamonds of which there were relatively very few in the country. Diamonds mined in South Africa were shipped uncut to be polished in Holland and Belgium.
It was only after the Pact Government came into power in 1924 that the agitation from the Kimberly diamond dealers to start a diamond cutting industry was favorably received. Two recruiters were sent to the Netherlands to encourage diamond workers there to come to South Africa and teach locals the trade.
At that time Amsterdam was the center of diamond-cutting and because there was no guild system in Holland preventing Jews from working with diamonds as there was in other trades, the profession was heavily influenced by Jews.
But since the end of the First World War in 1918 the diamond trade had practically ceased to exist in Europe. Dutch diamond cutters were keen to travel to America where the industry was still active but were subject to a quota system imposed by Washington limiting the number of immigrants from each European country.
There had been a burst of activity in 1919 when the Russian royal family jewels were sent to the Netherlands for re-polishing. These diamonds were referred to as the “Bolsheviki” and created a short boom but that was all.
When the South African recruiters arrived, Dutch Jewish diamond workers were waiting for work permits to America. Many were convinced to come to South Africa instead because, amongst other factors, the language was the same.
By 1925, the Kimberley trade had grown to such an extent, including polishing, that it moved to Johannesburg, the gold and finance center of the country and where many Jews lived.
Many of the diamond factories that opened up at this time were Jewish owned. Names like Goldstein, Reichman, Herskowitz, Blom, Messias, Fransman, deJong, Landau, Slier, Katz and others came to dominate the trade. The Diamond Club was formed and most members of the executive of the Master Diamond Cutters Association were Jewish.
The world financial problems of the 1930s affected the global trade but it survived. It soon went on to thrive when World War Two broke out in Europe and buying diamonds became an attractive alternative to saving money.
But competition was growing. The United States, the Netherlands, Belgium and South Africa were the main players and were soon joined by Israel after 1948. Today Russia, India and China are hugely influential in the trade and the largest diamond center in the world is in Dubai.
Mine shaft, Kimberley diamond mine. (credit: Courtesy)Enlrage image
Mine shaft, Kimberley diamond mine. (credit: Courtesy)
Many South African factory bosses complain that it is difficult to compete price-wise with these countries. High labor costs and indifferent government legislation has virtually put South African polishers out of business. There are fewer than 300 diamond workers in the country today. The trade is faltering despite the fact that the end of apartheid did away with labor restrictions and opened the industry to everyone.
Once a desirable trade for a nice Jewish boy, diamond cutting and polishing in South Africa no longer is. The local trade has lost its glitter and the Jewish handle at the helm has loosened and is not being replaced.
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