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State capturers who wanted a piece of the mining pie must be brought to book - Minerals Council president

Feb 04 2020 21:07
Carin Smith

Mining in South Africa was negatively affected under "state capturers who decided they wanted a piece of the mining industry", Mxolisi Mgojo, president of the Minerals Council South Africa, has said. 

Mgojo was speaking during a presentation at the Investing in African Mining Indaba in Cape Town on Monday.

He said the actions of the "state capturers" brought uncertainty to the industry about mineral rights, among other things. He said, apart from the negative impact of state capture on the mining, the industry was also challenged since the global financial crisis of 2008, which hit commodity prices.

"The public needs to see those criminally responsible brought to book. Also, the land expropriation issue needs to be made clear and (dubious) past transactions in the mining industry addressed before investors will invest in the industry," he emphasised.

Furthermore, the mining industry now faces the Eskom crisis, which is drastically eating into its sustainability, he added.

The Council urged government to urgently bring in the private sector in the supply of energy stability in the country.

"Energy self-generation is an area where government and the private sector can work together to help SA on the path to growth – and with that the mining industry too," Mgojo told the large audience.

Earlier at the indaba Minister of Mineral Resources Gwede Mantashe announced that government had conceded it must allow mining companies to produce energy for their own use. 

Health and safety

Mgojo said addressing health and safety issues in South Africa's mining industry was for him a top priority, despite fatalities decreasing by 92% to 51 in 2019 compared to 1993.

"While there have been significant strides made, we know we are not there yet. The mining industry's performance in the latter part of 2017 and first half of 2018 was challenging when we experienced an increase in fatalities for the first time in a decade," he said.

This led to what he describes as "heart felt" engagements among mining CEOs about health and safety issues and a decision to make it a priority focus.

"It is very important to reflect on the real value of mining to SA and its people. Notwithstanding many challenges the industry faced in 2019, mining still contributes 8% of South Africa's GDP and employs large numbers of people," he said.

At the same time, mining production has not really improved significantly since 2009, he pointed out.

Fostering inclusive growth remains another important challenge to address and, in his view, mining companies have made serious efforts to tackle the issue.

"What does it take to achieve inclusive growth? Government as well as mining companies can play a part in local and infrastructure development and in developing upstream and downstream beneficiation," he said.

Creating employment, should, in his view, almost be the most important priority of the mining industry.

"We are seeing heavy job losses in the gold, deep level platinum and diamond sectors, exacerbated by electricity tariff challenges, among other factors," he said.

"Yet, we must not think there is no employment growth in mining. It has grown at a slow and steady pace in sectors like coal, manganese and iron ore."

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