Address by Ms Susan Shabangu, Minister of Mineral Resources of South Africa, at the Cape Town Press Club, 6 Spin Street Restaurant, Cape Town, August 18 2011

Donwald Pressley, chairperson and members of the Press Club,
Ladies and gentlemen,

It is delightful to be here in this fairest Cape at a time when you have all been enjoying such balmy, summery weather  at least up to yesterday. But, indeed, the forecast suggests that the times, as the Bob Dylan album of 1964 put it, they are a 'changing' and that the Cape winter may revisit you very soon, hopefully not with too much vengeance. 

The weather is indeed a reminder of the capricious nature of life the high, happy moments and the dark vicissitudes that can follow. We in South Africa have our splendidly high moments, but also we have daily reminders of the very serious business, grim at times, that lies ahead of us to clear away, for instance, the threatening clouds of poverty, crime, and underdevelopment.

So I am indeed delighted this morning to address members of the fourth estate. In all of these events the media has a vital role to play in reporting and commenting, and ensuring that we have a society that is very much aware of what is happening around us. The media is a most important part of our lives; it reflects a perennial conversation between government and people.  And this is why I am honoured and pleased to be here amidst the media - in its various manifestations this morning 

We are all acutely aware that we are living in a fast changing world. Quite apart from the remarkable rise of nations like China and India, there are new and pressing challenges affecting even the developed countries - problems that strike at the roots of social stability.

There is, too, a sudden new emphasis on the environment and global warming, issues which seemed a mere speck on the horison not too many years ago - and when studies and dire warnings were dismissed as panicky. And it is our job to ensure that we uphold the new imperatives, while fostering sustainable development and righting historic wrongs.

Joseph Stiglitz, the 2001 Nobel economics laureate and Professor at Columbia University, wrote a piece which was also published in last week's Sunday Times, stating that "the only good thing about the continuing barrage of bad news is that it could have been worse."

In this article he speaks about what he calls the next round of great recession with things getting worse and with governments, including that of the United States, having no effective instruments to deal with this.

I am surprised that, while globally there is real concern about the state of the world economy, with all countries chasing investments to shore up their economies in a bid to drive growth and create sustainable jobs, we are grappling with a debate about nationalisation.

We do so in an environment where the balance of forces does not warrant such a focus. Instead, the balance of forces enjoins us to put into place programmes to resolve the evil triplets of poverty, unemployment and inequality.

Those are our critical priorities, as I feel sure you will agree. We shall have no nation without dealing fundamentally with these issues. We cannot have a situation where people are able to say even if tinged with exaggeration for effect that our wealth gap is one of the worst in the world, and widening. Our democracy demands better than that state of affairs.  And each and every one of us needs to reflect on this and practice what Mahatma Gandhi said in his famous statement, and be "the change we want to see in the world."

On nationalisation, I have noticed that individuals within the components of the congress alliance have expressed their own views on this matter, with some even telling anyone who cares  or designs  to listen that it is not a "question of whether but rather a question of when nationalisation will happen".

As the ANC and the government, we do not and cannot and dare not speak on behalf of other components of the congress alliance as we are an autonomous  organisation that represents the multiplicity of classes and strata that make up a dominant part of the body politic of our country. We should certainly not do this outside the accepted lines of policy.

So, these individuals have a right to lobby for their viewpoints within their individual organisations and within the congress alliance.  However, it cannot be correct that these then project their own ideas as views of the ANC, on any issue, including the issue of nationalisation. The last time I checked, the ANC was perfectly capable of speaking for itself.

However, these individuals must take a leaf from the book of the National Union of Mineworkers which has constructively tabled radical and far reaching alternatives to the nationalisation debate. The response of NUM indicates that, much as progress has been made, there is still a lot to be done with regard to transformation of the mining industry.

The mining industry cannot and should not be content with the exercise of ticking boxes merely for the sake of complying with the targets of the mining charter. The industry should wilfully embrace transformation and implement the provisions of the revised mining charter as a business imperative rather than a fruitless compliance exercise dressed in number crunching. 

I am encouraged by this progressive step from an organisation that truly represents the working class interests of hundreds of thousands of mineworkers who are the worst victims of the historical and other wrongs that are associated with the mining industry. However, I am sure that when the ANC deals with this issue it will engage its various structures and the congress alliance before taking a final decision at the Mangaung conference at the end of next year.

In the meantime we will implement fully, and without equivocation, the policies of the ANC-led government as they currently stand. We will implement them as we believe they are perfectly placed to help us to deal with the pressing challenges posed by the evil triplets we make bold to speak about.

There is general stakeholder agreement that in order to optimise the contribution of the mining sector to the economy, the focus must be on the entire minerals value chain, not just exclusively the mining sector. Countries of the south such as China and India have got this balance right as evidenced by the proliferation of their beneficiation industries.

We already have a large supplier base that provides goods and services into the mining sector (defined as side-stream beneficiation) and also a large downstream beneficiation sector that exists where the commercial opportunities are available. Taking advantage of the cabinet's recently approved beneficiation strategy we intend to move beyond the traditional and established forms of beneficiation of our locally mined products. In this regard we intend to search for new and innovative beneficiation taking advantage of our position as a leading producer of minerals such as, amongst others, platinum,  chrome and iron ore.

Critical to the success of our beneficiation initiatives is the creation of a policy environment that offers positive incentives like a deeper skills pool, a favourable tax climate, lowering the cost of capital and tackling head on the binding constraints in areas such as our rail, port and energy infrastructure.

We will be taking to the cabinet in the next few weeks our action plan of the beneficiation strategy and we are convinced that once cabinet has given its go-ahead we will be in a position to get rolling on this important issue.

One issue that has been repeatedly raised by various investors in the mining industry relates to the regulatory framework. This comes as no surprise given the fact that mining is a long term business that requires one to stay the course during that investment. Mining takes, for instance, almost R400 billion of expenditure each year, with an annual return to shareholders of approximately R16 billion, with R15 billion being paid in annual taxes to the fiscus.

So it is in this regard that governments have a responsibility to create an environment, both legislative and regulatory, to ensure that there is certainty and predictability in our mining jurisdiction. The audits, the moratorium and the subsequent introduction of the electronic application system are but a few of our interventions to create certainty and encourage investment in the mining industry.

As part of this we are introducing legislation to remove ambiguities and create the kind of legislative framework that will encourage investment and once again contribute to the attraction of our country as a mining destination.

Working together with the Departments of Environmental Affairs and Water Affairs we are developing procedures to streamline the processes involved in applications for mining rights; the amendment of the Mining and Petroleum Resources Development Act (MPRDA); mining within environmentally sensitive areas, including mining adjacent to the Mapungubwe Transfrontier Park.

Our work is not a flamboyant display done through the media, but a solid process based on sound facts, figures and perspectives. We are determined to do this important work as we seek to balance job creation requirements with those of sustainable development and achieving transformation.  It is tricky, but rewarding work.

Turning to the issue of mine health and safety, I want to reiterate that I am still very concerned about the continued carnage on our mines. To this end, from 01 January to 15 August this year about 76 workers lost their lives compared to 79 during the same period last year. It appears that most of these fatalities are related to increased production in the gold and platinum sectors. We are also very concerned about the lack of improvement in cases of tuberculosis (TB), silicosis, as well as noise induced diseases.

My department will continue with its hard stance on these issues. We will not hesitate to stop unsafe mines in order to save the lives of workers who inadvertently fall victims to these lapses. We are currently reviewing the Mine Health and Safety Act in order to strengthen enforcement whilst removing any ambiguities. 

I look forward to engaging with you at question time. You are welcome to raise any issue that you feel is pertinent.  I wish to thank the chairperson and the executive board for inviting me to speak to you. I hope we shall have more time for a two-way interaction.

I thank you!

Issued by the Department of Mineral Resources, August 18 2011

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