Discussions on charter not all rosy
Mining industry in closed talks
GWEDE Mantashe, the new mineral resources minister, says all the right things about the new Mining Charter he is helping to craft, but there is a growing sense of disquiet it will not be the panacea to the industry’s ills so many hoped for in February.
While the participants in the charter talks are bound by confidentiality, word is leaking out that while Mantashe is saying all the right things publicly, behind closed doors the situation is far less rosy.
The secretive nature of the talks has given rise to alarming rumours about increased ownership levels, up from 30% in the discredited third version of the charter, which itself was an unexpected increase from 26% in the first two charters.
There are also rumblings that while Gwede and his team are listening to the industry’s messages to make South Africa’s mining internationally competitive, they are not hearing and there are deep rifts on a number of key issues.
These could be contested in court if the gazetted version of the charter does not reflect these concerns, bringing the industry full circle back to the uncertainty that prevailed up to December last year before the gloom was tentatively lifted.
Mantashe was appointed by new President Cyril Ramaphosa in February, replacing the tainted and deeply disliked Mosebenzi Zwane, who was closely linked in the State of Capture report by former public protector Thuli Madonsela.
One controversial act in a litany of poor decisions by Zwane was the gazetting of a third iteration of the charter in June last year, which knocked R51-billion off JSE-listed mining stocks and prompted the Chamber of Mines (now Minerals Council SA) to seek the court to review and set aside the document.
Ramaphosa asked the council to set aside its court action and give fresh talks a chance to develop an investorfriendly charter.
Mantashe has spoken positively of the engagement with the council and expressed confidence the charter would be one all parties could take to international investors to bring riskaverse dollars back to South Africa, reversing deepening scepticism of the country as a mining destination.
Mantashe’s most recent comments on the charter were made at the annual meeting of the Minerals Council SA.
Asked about the difference of policy certainty – what Zwane failed to give the sector with his poorly drafted and confusing charter – he said: “When we bring this policy and regulatory certainty, the key is dialogue, so by the time we say we have a charter it must be something that the industry, communities, labour and the government can live with.
“Once we have agreement that this charter is acceptable to all of us, nobody will see it as a bad charter.”
One comment after Mantashe’s personable speech at the council meeting was that he was a true politician, with 10 years as secretary-general of the ANC, and that he was “speaking to his audience”.
Judging from the grim faces of Mxolisi Mgojo, CEO of Exxaro and president of the council, and Neal Froneman, Sibanye-Stillwater CEO and council deputy president, during Mantashe’s speech, there was clearly something going on in the charter talks not being said or aired by the minister.
Mantashe conceded there were “two or three” issues that needed to be resolved, but he maintained the charter would be gazetted in June.
Mantashe, now chairman of the ANC, has to deliver a charter that appeals to the party’s constituency after it lost support because of Jacob Zuma’s corruption and maladministration.
If that is the case, then Mantashe is putting party interests ahead of the broader society and would surely drive the council back to the court to resurrect its legal challenge against the charter, prolonging uncertainty and reinforcing the perception South Africa is not a business-friendly destination.
there are rumblings . . . there are deep rifts on a number of key issues