Excerpts from the opening keynote speech by South Africa’s minister of minerals Susan Shabangu, at the recently wrapped-up 19th Investing in Mining Indaba in Cape Town, South Africa (5 February, 2013)
The Mining indaba has grown in stature and content since it made a modest start in 1995, two years after the adoption of the interim constitution of 1993.
It is this constitution that mandated the government to effect the socio economic transformation of South Africa, which we have done since the dawn of democracy in 1994.
The transformation was, and still is, aimed at addressing the evil triplets of inequality, poverty and unemployment.
The ANC’s elective conference of December 2012 re-confirmed that: nationalisation is not an option for our country; this is the resolution of the ANC elective conference on this matter. Our government is fully conscious of the reality that mineral development cannot happen unless capital is invested by the private sector.
With regard to the State Owned Mining Company, African Exploration Mining and Finance Corporation, the process of hiving it off from CEF is at an advanced stage and should be completed during the first half of this year.
This year also marks a hundred years since the enactment of the Native Land Act, which created a system of land tenure that deprived the majority of South Africans of the right to own land, and eventually compelled Africans who had lost their land to join the mining industry as migrant labourers.
It is the remnants of this historical legacy of the migrant labour system, poor housing and living conditions, high levels of illiteracy, and low skills level that inevitably contributed to Marikana.
In order to deal with this urgent matter, government has appointed commission of enquiry headed by Judge Ian Farlam whilst at the same time we are responding to the broader socio-economic challenges through a package of measures announced by the President that addresses, amongst others, housing and living conditions of mine workers.
A lasting solution to these challenges should be acknowledgement of the need to address the underpinning structural and historical elements and not just the symptoms as they occur. This requires mining stakeholders to work together in partnerships in order to obviate any prospects of the events of last year repeating themselves. The country and the industry cannot afford the prospect of another Marikana.
The mining regulatory reform introduced in 2004 brought the South African mining industry in line with the international norm that recognises natural resources, including minerals, as a common heritage of the people. This reform further represented a “social pact of a special type” amongst mining stakeholders, namely government, business and organised labour.
As part of this, stakeholders committed themselves to a transformation window with targets to be achieved within a timeframe of 10 years ending next year.
The mining industry represents an important constituent part of the aspirational society defined in the National Development Plan. The number of mines has increased from 993 in 2004 to almost 1,600 today, while associated revenue generated grew astronomically in nominal terms from R98 billion in 2004 to R370 billion by the end of 2011.
Employment in the mining industry grew from just under 449 thousands in 2004 to marginally above 530 thousand in June 2012, before it started to regress slightly in the third quarter of last year. It is imperative that we work together by creating, amongst others, a competitive tax regime to ensure that our mining jurisdiction becomes a sector of choice for the investment in our economy and the rest of our continent.
We have a nation with a young population and work force that we can use to leverage the population dividend for the growth of the economy, generally, and the mining industry specifically.
Accordingly, we will work with our social partners and all relevant institutions such as the MQA and the Department of Higher Education and Training (DHET) to ensure that we plan for future training needs of the industry. The substantial increase in enrolment of both young females and males in engineering qualifications, with female enrolment doubling since 1996 suggests that the base skill requirements for the sustainability of the industry are being built, but these skills must be nurtured and protected.
We are working to increase our exploration activities and investment. The recent discovery of a noteworthy shale gas deposit is knowledge of the potential value that still lies in South Africa for development.
In our pursuit to protect this democracy and leverage the democratic dividend, government is committed to create a thriving and successful mining industry.
When you invest in Africa you are investing in the future.