ROCK CITY

The diamond industry is in the middle of seismic change, but Antwerp is determined to retain its title as the world’s premier diamond centre.

LAST OCTOBER ANTWERP HOSTED ITS FOURTH ANNUAL DIAMOND CONFERENCE, welcoming businessmen, government ministers and even Nobel Prize winners to the city to discuss the future of the industry. Gareth Penny, managing director of De Beers, South Africa, summed up the mood in his address. “While our historic past may have been considered by some to be comfortable and certain,” he declared, “to think that we could just go on as before while the world around us changes so swiftly is wishful thinking and, frankly, not an option.”

The diamond industry is changing fast, and it’s clear to all in Antwerp that there’s no room for complacency. The official representative of the city’s diamond community, the Antwerp World Diamond Center (AWDC) has its headquarters on Hoveniersstraat in the heart of the diamond district, and the organisation is determined to stay at the forefront of the industry’s – and the city’s – evolution. Within these few small streets, more than 1,500 companies and four bourses handle 80 per cent of the world’s rough diamond trade and half of all polished stones. It is one of the most highly protected streets in the world, yet the video cameras lining the buildings capture an atmosphere more suited to a church than a market place. An air of reverence hangs over the knots of Indian and Jewish businessmen who cluster outside the understated office buildings, and the overwhelming sense is of old-world elegance rather than new-money bling.

In his office on the seventh floor, the AWDC’s chief officer of corporate affairs, Philip Claes offers a revealing perspective on how traditional practices continue to set the industry apart. There are no contracts in this business – a man’s handshake (called a mazel from the Jewish mazel u’bracha or ‘good luck’) will suffice. “This trust is not unique to Antwerp,” says Claes, “but it is unique to the diamond industry.” Anybody who betrays it will have their misdeeds made public at the 26 bourses worldwide “…so you can do it once but you can forget about your future in the diamond industry.” Confidence and transparency are just two issues that need to be addressed. These are challenging times not just for Antwerp, but for all diamond centres from New York to Tel Aviv, Dubai, Mumbai and Africa. “We are passing through uncharted territories with unproven strategies,” said Chaim Even-Zohar, the CEO of Israel’s Tacy Ltd, and chair of the 2007 conference.

But there are opportunities as well. For Claes, the defining issue of the next decade will be beneficiation, whereby producer countries in Africa will increasingly keep the profits of their own natural resources, unlocking new capital to invest in education, infrastructure and employment. The move has been a long time coming (the South African government has been lobbying since 1915) but finally, in the words of Gareth Penny: “Change has taken on a momentum and moral imperative of its own.” And crucially, Antwerp will still have a key role to play, as Claes explains: “The African countries know that they need our experience and our know-how because they will not succeed on their own. It will be very difficult for them but we wish them all the luck.”

As Africa comes to the forefront of world production, Claes sees the consumer market shifting focus. The rise of China and India will increase demand at a time when analysts predict that supplies are on the wane. That puts the emphasis on new mines, with Canada, Russia and Angola looking the most promising sites. What this means for Antwerp, says Claes, is increased competition with its rivals for a slice of the new business. Although New York has the retail trade sown up, Antwerp continues to enjoy significant advantages over its competitors in India and the Middle East. “Our most important asset is that we offer stability,” says Claes. “Economic stability, tax stability, political stability, social stability, religious stability – and that kind of stability you don’t find in other centres.”

The number of different nationalities attracted to the city by this stability is evident from walking down the street, but with so many competing interests, as well as ethnic and religious divisions, is there ever any tension between businesses? “This is a multicultural environment where everybody respects everybody,” explains Claes. “If there is tension between two people it is because there is competition, but that’s healthy. It’s not a real tension and it certainly isn’t ethnic or racial.”

Five floors below Claes’ office sits one of the hubs of the AWDC’s operations in Antwerp. The HRD Certificates Department is a laboratory where diamonds are tested for the four Cs – cut, clarity, colour and carats – before being issued with a highly-prized certificate of authenticity. The judgements of the 160-strong testing team are a key part of Antwerp’s reputation as a centre of knowledge and excellence. At each of the four stages, a diamond will be assessed by three separate analysts working independently of each other, and anonymously from the stone’s owner to ensure they can’t be influenced. If there is a discrepancy in any of the judgements at any stage, the diamond will pass to a fourth, fifth or even sixth individual of increasing authority.

Visitors are rarely allowed a glimpse of the lab. No other AWDC employees are allowed to pass through its heavy wooden doors, beyond which lies a reception room surrounded by cameras attached to the ceiling. But cameras aside, there are no overt signs that millions of euros’ worth of diamonds are handled here every day. There are no burly guards or security checks, coats and bags aren’t confiscated, and the air is more trusting professionalism than suspicious paranoia. Indeed, for anybody with visions of wizened old men bending over ancient tables, the first impression is one of anticlimax. Beyond the veil of secrecy lies another open plan office, where a youthful workforce sits at desks illuminated by bright spot lamps. There are windows on one side of the room, but the light is subdued – lighting conditions are strictly controlled to ensure that the colour and clarity of the diamonds can be gauged correctly.

In stark contrast to the bourses and trading houses, the laboratory employs more females than men. As Philip Claes explains: “Dealing is mostly done by men because it’s a profession that goes from father to son. There are some female dealers but they are the exception.”

Such segregation is just one example of the industry’s ancient customs, but as change accelerates there’s a sense that innovation will increasingly eat into tradition. There is no longer any doubt that Antwerp is set to enter a brave new world, the question is how prepared the city will be to meet the challenges. Beneficiation has the potential to redress the economic order of the diamond business, but even in a world of supply-controlled distribution, Antwerp will seek to remain at the heart of the operations.

As Gareth Penny said in his speech to the 2007 conference: “The centre of gravity of the diamond business may be about to shift, but I believe this creates real opportunities in Antwerp.” Far from marginalising the city as a traditional powerhouse, the 21st-century offers huge rewards for those with the vision, creativity and willingness to embrace change.

STAR POWER

ANTWERP’S DIAMOND INDUSTRY MAY WELL BE characterised by its sober professionalism and world-famous expertise, but that’s not to say the city doesn’t indulge in a touch of glamour every now and then. The Antwerp Diamond Museum specialises in exhibitions that trumpet the diamond’s place in popular culture, focusing on the bling, sparkle and excitement more usually associated with a girl’s best friend.

From 11 April – 8 June the museum will be home to Diamond Divas, an exhibition glorying in the iconic diamond jewellery worn by some of the world’s most glamorous women. Showcasing the Taylor-Burton diamond, bought by Richard Burton for his wife Elizabeth Taylor, and the Moon of Baroda, famously worn by Marilyn Monroe (pictured above) and never exhibited before, the diamonds really are the stars.

www.diamonddivas.be

WORDS BY MATT BOCHENSKI
PHOTOGRAPHY BY CLAIRE DAVIES