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Ramaphosa: Dialogue can help solve Mining Charter impasse

Sep 06 2017 21:15
Jan Cronje

Cape Town - Deputy President Cyril Ramaphosa said on Wednesday that dialogue and collaboration could help thrash out a compromise between the mining industry and the Department of Mineral Resources over the contentious Mining Charter. 

Ramaphosa was answering written questions in the National Assembly in wake of positive economic news, with Statistics SA announcing on Tuesday that the country's gross domestic product (GDP) had grown by 2.5% in the second quarter of 2017. 

“Many countries are having to deal with their own challenges of growth. Therefore, the news from our own statistician that the GDP had risen to 2.5% in the quarter was very encouraging indeed,” he said.  

He added it was “not yet time to celebrate”. 

“We are far behind our NDP (National Development Plan) target of 5% growth per annum. The triple challenge of unemployment, poverty and inequality remains.” 

Ramaphosa said Statistics SA’s report had identified “green shoots” in a number of sectors of the economy. 

“If you look at what drove the last quarter growth to 2.5%, you will see that mining was one of those and agriculture was one of those.” This showed the economy “can indeed generate growth”, according to Ramaphosa. 

The deputy president was asked by DA mineral resources spokesperson James Lorimer if he would be willing to scrap the new Mining Charter, which was published in June this year. 

Key aspects of the charter include an increase in black economic empowerment (BEE) shareholding of all mines from a previous 26% to 30%. In addition, 50% of all board members and executive management at mines must be black, while 70% of all mining goods and 80% of all services in the mining industry must be procured from BEE entities.

New mining rights are subject to a 1% revenue payment to BEE shareholders prior to any shareholder distribution.

The charter has been criticised by the Chamber of Mines, which has said in its current form it would “jeopardise the viability of an industry that is already under significant economic pressure”.

Its implementation is currently suspended, awaiting a forthcoming court case. 

“You can't hope to save mining jobs unless the mining industry has confidence in this government and its policies. Now we know the industry does not,” said Lorrimer. 

Ramaphosa answered that dialogue was taking place between the mining industry and government. 

“The mining charter was released to industry, and what is now ensuing is that there are discussions taking place between the mining industry, government and labour, and indeed other players,” he said. 

“I have often said ‘let us allow that process to carry on’. That is a process through which the roleplayers in the industry will be able to resolve the problems that beset the industry right now.

“The 10-point mining plan that was released seeks to address some of these challenges. Addressing the Mining Charter is also going to be able to allow the stakeholders to talk to each other.”

Collaboration is key 

Ramaphosa said both sides must keep talking to each other. 

“I was one of those who said ‘I want us to encourage a collaboration and a dialogue between all stakeholders in the mining industry’.” 

Pressed by MP’s from various political parties on details about plans to grow jobs, Ramaphosa returned to his theme of collaboration. 

“It is when we work together, when all sectors and stakeholders in SA work together, that we are able to address (these) problems.”

In response to a question by Cope’s Willie Madisha about the rising unemployment rate, Ramaphosa said the “structure” of the economy needed to change. 

“I would agree that the structure of our economy does, in the number of ways, give rise to levels of unemployment, our inability to create the greater number of jobs that the country should have," he said.

“It is when we go to the root of these systemic challenges and problems, that we will be able to resolve the structure of our economy and unlock growth.”

Ramaphosa said the government was focusing on how to restructure the economy, but did not provide any further details in reply to Madisha’s question. 

Regarding youth unemployment, Ramaphosa said he was confident that the government's ambitious Youth Employment Service, which seeks to place young South Africans in learnerships and internships, could add a million jobs over the next three years. 

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