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SA must salvage mining image

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By Dineo Faku.

South Africa will be looking to salvage its image as a safe and viable destination for mining investment when Mineral Resources Minister Susan Shabangu welcomes delegates and investors to the annual Mining Indaba that is being held in Cape Town this week.

The conference is a forum for information sharing, debating and networking by some of the world’s key players in the mining industry.

During her tenure as minister, Shabangu has been a regular feature at the event, and her speech will be closely watched for cues on policy issues.

The Investing In Africa Mining Indaba starts today and ends on Thursday.

Besides Shabangu, keynote speakers at this year’s event include Anglo American chief executive designate Mark Cutifani, Gold Fields chairwoman Mamphela Ramphele, and global investment strategist and commentator Marc Faber.

The backdrop for this year’s indaba is the labour unrest that shook South Africa’s mining industry last year and raised concerns about its stability.

The other big issue involves an apparent strain in relations between the government and the mining industry, especially as news of planned restructurings and retrenchments raises the tension.

The platinum sector, centred on Rustenburg in North West, was brought to its knees last year as a labour dispute over wages at Lonmin escalated, resulting in a bloodbath in which 34 miners were shot dead by the police.

The trouble quickly spread to the gold mining sector, even causing a brief but costly shutdown of operations at major mining companies, including AngloGold Ashanti.

The mining unrest has contributed to South Africa’s credit ratings being downgraded for the first time since the end of apartheid. Credit rating agencies raised concerns about labour strife, rising social tensions and nationalisation calls. In the process, the rand has also taken a knock.

After her recent public spat with Anglo American Platinum (Amplats) over the firm’s plan to sack up to 14 000 workers in a wide-ranging retructuring, Shabangu will be hard pressed to instil confidence in the country’s mining future.

“The industry is aware that change is needed,” said Jonathan Moore, the vice-president and managing director of Mining Indaba 2013. The focus would be on “opportunities on the continent. We don’t have a general practice of talking about politics, including labour”.

Even so, politics will certainly be an inescapable part of the deliberations as investors are clamouring for certainty, more so after Shabangu threatened to subject Anglo American’s mining rights to a government review in response to Amplats’s plans to mothball shafts and trim its workforce.

National Union of Mineworkers (NUM) spokesman Lesiba Seshoka said the union had never had any expectations about the Mining Indaba being able to produce outcomes over the years, because it excluded workers.

“We know that the indaba is a gathering of a few people with money who are going to discuss how to maximise profits and ensure that workers labour even more, and that bigger figures of workers are shed away,” he said.

John Capel, an executive director at Bench Marks Foundation, a non-governmental organisation, said he expected the Mining Indaba to highlight social responsibility issues.

“The indaba needs to consider the reports on social responsibility done across the African continent, which focus on issues including water. The polluter pays principle needs to be implemented. If water is polluted, communities lose their livelihoods,” Capel said.

The foundation is one of the founders of the Alternative Mining Indaba, also held in Cape Town. It is aimed at creating awareness on issues including the poverty of communities adjacent to mining companies and the impact of mining on the environment.

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