WHAT HAPPENS TO
mining towns after mining has ended? In the case of Kleinzee – a diamond mining town about 600km north of Cape Town on South Africa’s west coast – it’s near oblivion. Having sprouted expressly to support marine diamond mining, the community is now clutching at straws following De Beers’ decision to ratchet down operations.
“All my friends lost their jobs,” Ann Engelbrecht told an AFP news agency reporter in a report posted on Miningmx in August this year. “This is a mining town – what must they do here?” she asked.
Engelbrecht runs the local Spar supermarket and has seen sales fall 60% since taking it over in 2007. She’d worked for De Beers since 1984 but wonders whether her career switch was a wise move after having already suffered two heart attacks – from stress. “It’s just not worth it any more,” she says.
Virginia, the gold mining town in SA’s Free State province, is another typical example of what happens when mining leaves. Gold was discovered there in 1955 and an extensive gold mine industry developed around it. But the once vibrant industry is in decline. Harmony Gold keeps the flag flying for gold but at current rand gold prices even its key Free State mines are under pressure and could be reviewed.
One particular problem is how residents relocate when, having ploughed savings into mortgage repayments, they find property demand so poor it’s impossible to get a return. Who wants to pay R1.5m for a house in a town without a beating heart? They either stay or move to Johannesburg and live with their children.
SA’s Government has attempted to head off the problem of mining ghost towns by legislating for it, quite punitively in some cases. For example, the Minerals and Petroleum Development Resources Act of 2005 requires mining firms to submit social and labour plans or risk losing their right to mine. One of its aims is to stimulate industry outside mining and mining services.