DIAMONDS,GOLD,AND BRITISHIMPERIALISM
vaal in a political union with the other self-governing South African colo-
nies. The existing system of trade relations in the region, which were
regulated by a customs union and railway agreements that had been nego-
tiated by Milner, was on the verge of collapse. The customs union was
threatened because the coastal colonies relied heavily on tariffs for revenue,
whereas the inland colonies were more interested in reducing the cost of
imported goods. There was also intense competition among the state rail-
ways for the trade from the ports to the interior, and Portugal was threaten-
ing to stop sending Mozambican laborers to the gold mines if the colonies
imposed differential rates to offset Lourenco Marques's advantage as the
closest port to the Witwatersrand. 58
Events in Natal, where Africans outnumbered Whites by ten to one,
were another factor that led many white South Africans to favor a political
union. In 1906, the Natal militia suppressed an African rebellion led by
Bambatha, a former chief whom the government had deposed, with a loss
of thirty white men and some three thousand Zulu; and in the following
year the Natal government remobilized the militia and arrested Dinuzulu,