ANC has no real desire to grow mineral sector and create more employment

5 September 2019

Speaker,

There can be no doubt that South Africa has a jobs crisis. Roughly 10 million South Africans are unemployed. At the same time, we have an economy that is barely marking time. And our government is not helping!

In 1970, mining contributed 21.3% to our country’s Gross Domestic Product. It now stands at less than 8%. Jobs in the sector have dropped from 528 000 employees in 2008 to just 459 000 today, according to the Quarterly Employment Statistics published by StatsSA. That’s a drop of some 13% over a period of just over 10 years!

The question we need to ask ourselves is why? As one of the world’s richest nations when it comes to mineral resources, why is our mining sector in general decline? Why is our mining sector producing less than other nations? Why is mining, which should be a driving force in our economy, unable to deliver economic growth and employment?

The answer is that the Department of Mineral Resources is stuck in the past, and that the ANC has no real desire to grow the sector and create more employment. The department does nothing – nothing! – to encourage investment in prospecting, exploration and  actual mining. In fact, its actions have actively chased investors away. It has a defunct mineral rights administration, mired by corruption. It has created a policy mess by tinkering with the mining charter, which leaves investors questioning whether they should invest. It has essentially allowed unions to call the shots when it comes to mining because it is toothless and visionless.

The only reason mining companies remain here, despite the challenges, is our vast mineral wealth. But even so, many feel that other African countries – Botswana, Ghana and Mali, to name but a few – are much more attractive. And so we are seeing a disinvestment in South Africa. Just this week, Neil Froneman, CEO of Sibanye-Stillwater, the world’s largest platinum miner, said that there is little incentive to put more money in the country and that they were seeking to reduce their exposure to our economy.

Mining remains a sector that can rapidly grow its workforce. But the government needs to take bold and decisive steps. We must:

- Scrap the mining charter;

- Streamline mining rights administration;

- Make it easier for mines to produce their own electricity, or purchase directly from Independent Power Producers.

- We must clean up the corruption in the department; and

- We need to reign in the unions.

Speaker, if we really want jobs, if we really want our economy to grow, we need to encourage investment in the mining sector. Instead of cutting the cake into smaller and smaller slices, we need to make a bigger cake. We must make South Africa attractive to foreign investment and easier to do business. We must incentivise prospecting and exploration.

We can either create more jobs, or we can jealously protect the ones we have. But if we want South Africa to succeed, we need to get our people working. And that means growing the mining sector.

Issued by Kevin Mileham, DA Shadow Minister of Mineral Resources, 5 September 2019