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South Africans urged to invest in the mining sector

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Gwede Mantashe says while government continues to work hard to attract foreign direct investment into South Africa, there has been a positive change domestically, with companies pledging huge investments into the economy. SA News.gov.za Gwede Mantashe says while government continues to work hard to attract foreign direct investment into South Africa, there has been a positive change domestically, with companies pledging huge investments into the economy.
Positive change in domestic mining investments

Monday, February 4, 2019

Staff Reporter

Pretoria, South Africa: Mineral Resources Minister Gwede Mantashe says while government continues to work hard to attract foreign direct investment into South Africa, there has been a positive change domestically, with companies pledging huge investments into the economy.

He said this during a media briefing, shortly after addressing the opening session of Investing in African Mining Indaba, at the Cape Town International Convention Centre, on Monday.

“We as South Africans must invest [in the mining sector]. I think one of the companies, Exxaro, announced a R20 billion investment. Sasol announced a [multi-billion investment] … there is a change in the attitude in the sector…

“The environment is conducive; we are in talking terms; we are engaging regularly since the compact that we signed this morning,” he said.

Mantashe said government, along with other role players, have been working on an agreement in the industry for a collective, sustainable and transformed industry. He said the agreement was signed this morning by role players such as trade unions, the Minerals Council South Africa and the South African Mining Development Association (Samda).

He said the compact contains eleven areas of focus that the Social Partners believe provide the basis for a roadmap to attain vision 2030. There will be an implementation plan developed to keep track of progress made and milestones reached.

“This is a commitment for all of us to work together in ensuring that this industry grows and is sustainable and that it is the most transformed. Our vision for 2030 is to be the most transformed sector in the globe,” he said.

Delivering a keynote address earlier on, Mantashe said there has been signs of recovery in demand in the mining sector over the past two years and this has resulted in an upswing of some commodity prices.
He said, however, that the future however remains uncertain, with the World Bank predicting global growth rate to slow this year, to 2.9%.
 
“As South Africa we remain optimistic given the performance of the economy, considering that we emerged from a technical recession in the third quarter of 2018 with a 2.2 percent growth quarter-on-quarter. This was mainly due to higher contributions to growth in several industries, most notably in manufacturing, transport as well as finance and business services.

“More recent data shows that mining production in SA rose by 0.5 percent year-on-year in October 2018, contributing R447 billion to the economy largely due to increased production of nickel, PGMs, diamonds, manganese and chromium ores.

“By the third quarter of 2018, the industry employed 457 000 people, slightly down from 463 000 people in 2017, with most of the jobs being shed in the gold and platinum sectors,” he said.
Mantashe said the increase in mining production was offset by the increase in employment in other subsectors of the industry, such as coal and manganese.
 
He said 70 mining rights were granted by the department and five new mines came into operation, most of them being coal mines, demonstrating that there is still keen interest from investors.
 
Draft Bill on oil and gas to be introduced in new Parliament
 
Mantashe said, meanwhile, that the finalisation of the Mining Charter, and provision of clarity on the Mineral and Petroleum Resources Development Amendment Bill, formed a critical component of President Cyril Ramaphosa’s stimulus and recovery plan.

He said to date, the Charter guidelines have been gazetted and the Mineral and Petroleum Resources Development Amendment Bill has been withdrawn to separate oil and gas from the mining legislation.
He said a draft Upstream Petroleum Bill aimed at establishing a separate oil and gas industry is in the process of being developed.
 
“This Bill will provide certainty to the upstream petroleum industry and stimulate growth and development in this sector. In respect of mining, the Mineral and Petroleum Resources Development Act, 2002 as amended continues to apply.
 
“We can therefore say with confidence that South Africa provides a conducive environment for investment, and that we have a stable regulatory framework which provides security of tenure for investors,” he said.
 
During 2018, the mining industry experienced several accidents and a high number of disasters resulting in multiple fatalities necessitating that we move up the Mine Occupational Health and Safety Summit to October. The Summit created a platform for all stakeholders to engage and come up with solutions that will assist the industry turn the tide with regards to fatalities, injuries and diseases. We should remain vigilant in ensuring we do not see a repeat of last year’s disasters so every worker can return from work unharmed every day. Meanwhile, President Ramaphosa is expected to address day 2 of the indaba on Tuesday afternoon.