Chamber of Mines seeks intervention on Mining Charter

21 June 2017

The African National Congress has met with the Chamber of Mines following concerns raised by the Chamber about the revised Mining Charter announced by Mineral Resources Minister, Comrade Mosebenzi Zwane last week. The meeting attended by ANC Secretary General, Comrade Gwede Mantashe, Treasurer General Zweli Mkhize and members of the Economic Transformation Subcommittee led by Chairperson Enoch Godongwane was held at Luthuli House yesterday.

The Chamber of Mines is the mining industry employer organization representing 67 companies which are responsible for the production of 90% of South Africa’s mineral production. It defines its key role as “the facilitation of interaction among mining employers to examine policy issues and other matters of mutual concern to crystallise and define desirable industry standpoints.” The Chamber met with the ANC to voice its dissatisfaction with the “flawed process”, the content and the “continuing consequences” of the Mining Charter.

In the meeting representatives of the mining industry called on the ANC to intervene and mediate in the impasse between the industry and the Department of Mineral Resources. “We want to go back to the negotiating table with government in order to emerge with a solution that must work for both parties. Through thorough negotiation, as we had in the development of the first and second Mining Charters,  we are confident that we may come up with an outcome that responds to the urgent national imperative of transformation whilst retaining the vision of a globally competitive mining industry” said the industry.

In particular the Chamber decries what it has called a lack of consultation on the amendments in the mining charter claiming that the new Charter is “fundamentally different from the draft Charter published in April last year.” According to the Chamber, “the content proposed has very draconian measures most of which are brand new ideas which being parachuted into the new Charter after extensive discussions had already been held.”

The Chamber also laments the break down of trust between itself and the Department of Mineral Resources and has committed to participating in any type of mediated process to restore trust between the parties.

Substantive issues that the Chamber of Mines objects in the new charter include the directive to distribute 1% of turnover amongst BEE partners before any distribution to shareholders. The inclusion of naturalized citizens as beneficiaries of that Charter was likened to the act of “feeding the neighbour’s children before you are able to feed your own”, arguing that South Africa has not yet manage to empower its own citizens yet now proposes extending these minimal opportunities to naturalized citizens.

ANC Secretary General Cde Gwede Mantashe has committed to raise the issues brought forward by the Mining Chamber within the organization and with its deployees in government.

Mantashe emphasized the need to accelerate the pace of change in the mining sector, warning however of adopting a reckless approach to enforcing transformation. “We have a responsibility to mitigate between a conservative and adventurous approach to the economy. Yes there are problems and transformation in the mining industry is not happening at an acceptable pace.When there are problems populism comes to the fore and in the process destroy what is already there” says Mantashe.

The Chamber has called on the ANC to ensure policy certainty and work with the industry restore investor confidence. “Through a process of co-creation..” government and industry must “embrace imperatives of transformation on one hand within a framework that can make the industry attractive and investable”. The Chamber impressed upon the ANC to intervene calling for the “political leadership of the country to prevail upon government to suspend the application of charter and send the parties back to table for a mediated discussion. Through such negotiations we can craft an outcome where the Charter can be owned, defended and implemented by all stakeholders.”

Issued by ANC, 21 June 2017