Mining firms tap into vein of hope for change

Over the last few years, a recurring theme at the annual Investing in African Mining Indaba has been the uncertainty in the SA mining industry.

Primarily, this has been around regulatory and legislative issues that have made investors wary of committing capital to SA.

That hasn’t gone away. As Baker McKenzie’s Morne van der Merwe said, the new Mining Charter and the Mineral and Petroleum Resources Development Act (MPRDA) Amendment Bill continue to create a great deal of uncertainty in the local sector.

However, there’s also a sense at this year’s indaba that the outlook may be changing. Cyril Ramaphosa’s election as ANC president and that he’s already making his influence felt are creating optimism the sector’s troubles could also be tackled. Webber Wentzel’s Jonathan Veeran said: “There is a sense in the industry that things are going to change.”

During his recent trip to the World Economic Forum in Davos, Ramaphosa said that if the Mining Charter was impairing the industry’s development, it had to be looked at. Ramaphosa is also well placed to deal with mining issues due to his history with the National Union of Mineworkers. This is renewing people’s confidence.

“You could get to a tipping point quite easily, where we can come off this very negative path,” said Van der Merwe.

Reinvigorating the industry requires resolving regulatory and legislative concerns, dealing with the Department of Mineral Resources’ dysfunctionality and resolving bureaucratic issues. Mending the trust deficit between business, near-mine communities, government and labour is also imperative. But there is a clear sense these goals are now achievable, and if so, SA has much to offer.