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Durban - The ANC is facing a decisive split at a major policy meeting on nationalising mines that seems to be as much about economics as it is about politics in the world's biggest producer of platinum.
President Jacob Zuma's ruling African National Congress (ANC) party is resisting a drive from the ANC's Youth League, backed by mining tycoons, that policy should be developed for the state to take over mines in the resource-rich country.
"There have been very heated discussions on nationalisation. Although President Zuma had stressed that this is not a policy conference and the issue needs more research, at the end, the youth league got its way," said an ANC member who attended closed discussions on economic transformation.
Zuma and ANC officials said no new policies would be adopted at the party's week-long national general council, one of its most important political events in years, but that has not stopped the push for nationalisation.
The mining sector's influence on the economy in the world's fourth-largest producer of gold has declined, but it is still one of the country's top employers, accounting for about 5% to 7% of the GDP of Africa's biggest economy.
"It is clear to anyone in the leadership who has the vaguest clue about economics and the drivers of investment that the idea as expounded by the Youth League would be bad for South Africa, bad for investment and bad for government," said Nic Borain, an independent political analyst.
Youth League leader Julius Malema and his backers, including millionaire businessman and Housing Minister Tokyo Sexwale, argue for state intervention in the mining sector so profits could benefit the country's poor instead of global mining giants.
But South Africa's state-owned enterprises have been racked by losses on balance sheets and chaos in the board rooms, which does not bode well for the prospects of a state mining firm.
Calls for discipline
Mine nationalisation would place an enormous financial burden on the country, with the Mail and Guardian newspaper citing estimates of at least $280bn in terms of cost - more than double the annual state budget.
"Despite its communist ties, the ANC is a progressive party that knows that it is important to keep business on its side," said an ANC delegate who asked not to named. The pleas for nationalisation are seen in some quarters not as a call to transform the industry, but more as a plan to bail out troubled mines owned by those with political connections.
"Those who own the least productive bits of it would love to be bought out by government," Borain said.
Delegates have said that the tussle over mines has also been used by various elements in the party to bring political pressure on Zuma as they try to line up possible bids for power.
As the mine debate has heated up, so have the ANC's calls for discipline in the party.
"Members of the alliance must avoid public spats because this alien behaviour undermines the standing of the alliance amongst ordinary people," the party said in a document.
