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Mines can't afford long-term load shedding

Feb 10 2015 20:00

Cape Town – Mineral Resources Minister Ngoako Ramatlhodi failed to give any indication as to how the government intended on assisting the mining community during the nation’s current electricity crisis, according to a delegate who attended his speech at the opening of the Mining Indaba in Cape Town on Tuesday.

READ: Stage 1 load shedding will start at 18:00

Jacques Barradas, partner at Grant Thornton Johannesburg, was responding to Ramatlhodi’s speech, in which he said: “There is no mining without energy”.  

READ: Ramatlhodi: SA has stable mining environment

Barradas said: “There is no doubt that the mining sector is singularly the most important industry in South Africa and Africa, which is directly and dramatically affected by power outages. Elaborating on this topic in particular, was a missed opportunity for the minister.”

Former British prime minister Tony Blair told delegates on Tuesday that without electricity, African countries stood no chance at growing and attracting investment.

READ: Live coverage from Blair’s speech

Barradas said South Africa could not afford an extended load shedding period, which is currently taking place.

“Companies, mines and management can and have made short-term plans to work around the current load shedding crisis,” he said. “However, if this crisis continues, it will have a serious [and possibly irreversible] long-term negative impact on the economy and South Africa as a whole.”

Fin24's Matthew le Cordeur filed this video report from the Mining Indaba:

READ: Full coverage of the 2015 Mining Indaba

SA is ready for investment

Ramatlhodi told delegates that South Africa was ready for investment despite the current commodity crunch. “The weak commodity prices bring with it opportunities to do business,” he said.

Barradas said he agreed with the minster. “South Africa needs to be singing from same hymn sheet particularly between government, business and - most importantly – labour,” he said.

“All three role players need to be included in the investment processes,” he said. “It is clear from the previous years’ strike action that labour must buy into the process otherwise it could disrupt the business environment completely.”

Cracking down on illegal miners

Ramatlhodi said the government was taking a tough stance on illegal miners. “Government will arrest and charge lawbreakers and send them to jail,” he said.

Barradas applauded the minister for what he termed his “almost militant stance" when referring to striking mineworkers that “damage and loot the community in which they live and within their place of work too”.

“I would encourage the minister to follow through on this promise in the coming months.”

The minister also said that the era of the individual BEE deals were over. Responding to this, Barradas  said that government should ensure the companies assigned to create BEE structures included the local communities in these projects at all times, “and that this process is not just about well-connected individuals coming together to form these structures”.

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