May 2011

South Africa looking forward

Government delegation addresses issues plaguing reputation

By Jeff Borsato

South Africa’s mining industry is open for business. That was the message that the mining delegation from South Africa wanted to make sure was heard loud and clear at this year’s PDAC Convention held in Toronto in early March.

Led by South African Minister of Mineral Resources Susan Shabangu, a delegation of business and labour representatives of the Mining Industry Growth and Development Task Team was at the international gathering to allay investor’s concerns about the recent Fraser Institute report that ranked South Africa 67th out of 79 in mining jurisdictions.

Shabangu said that to encourage development, it is vital that South Africa’s policy-makers continually review their legal framework in order to align it with broader national strategies that guide future development. She stressed that any policy framework for future development must be tailored to South Africa’s needs – just as Brazil and other emerging economies have done with great success.

Proposed amendments to the Mineral and Petroleum Resource Development Act were a hot topic at the seminar. Attendees had many questions regarding Section 11 of the Act, which regulates the transferability of prospecting and mining rights. Shabangu outlined how Section 11 is being carefully reviewed to ensure that ambiguities in some of the provisions are removed. As well, she said that a streamlining of the licensing processes to a virtual “one-stop shop” for mining requirements would be instituted. She added that the ministry is reducing the wait time for mining and prospecting licenses from six months to three months. The minister is also focused on strengthening the provisions to improve working conditions in mines, as well as publishing a new mining charter that includes clearer requirements.

On her first diplomatic assignment, Mohau Pheko, South Africa’s high commissioner to Canada, emphasized the importance of a collaborative relationship between the minerals industry, its workers and the citizens of South Africa as a whole. “Collaboration will help to create a fair playing field between the state and industry,” she said. Pheko outlined the government’s vision to ensure the domestic supply of key materials such as coal. She also highlighted core issues of local consumption versus export for coal, and how maintaining a steady domestic supply remains a key issue for her government.

Senzeni Zokwana, president of the National Union of Mine Workers and of the International Federation of Chemical, Energy, Mine and General Workers’ Union, focused his remarks on the people who make up the industry. Employing approximately 460,000 people directly and 400,000 on the supply and service side, the minerals and exploration industry remains a vital component of South Africa’s economy. Zokwana pointed to ongoing efforts by the government and unions to promote not just academic credentials of workers, but also direct skills, including trades. “Engaging youth is critical to South Africa’s continued development, and we must face the challenge to engage firms to develop skills needed for the future,” he said. Both Zokwana and Shabangu referred to a recent policy framework released by the South African government known as “The New Growth Path,” which prioritizes the mining industry value chain as one of the “growth nodes” of the economy.

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