Thu, Jun 22, 2017 - Page 6 News List

State negotiation needed on South Africa mine rules

Bloomberg

South Africa should negotiate with mining companies over controversial new regulations that are supposed to help spread the country’s mineral wealth more broadly, but have drawn clamors of outrage from the industry, South African Deputy President Cyril Ramaphosa said.

“Both parties must go back to the drawing board, and they must sit down and talk about their shared interest, their shared future and how best they can reach a measure of consensus” about the new Mining Charter, Ramaphosa said on Tuesday at an event in Johannesburg. “In the end, the mining industry needs investors, but at the same time it needs to transform.”

The charter was released on Thursday last week by South African Minister of Mineral Resources Mosebenzi Zwane and immediately criticized by the industry, which said it was not consulted and that the changes, including a higher minimum level for black ownership, would hurt investment.

Public disagreement about the new rules further highlights rifts in the country’s ruling African National Congress (ANC), of which Ramaphosa is also deputy president, before a leadership conference to elect a successor to South African President Jacob Zuma in December.

The ANC last week expressed concern about the charter’s effects on employment and said it would seek an urgent meeting with Zwane.

The Chamber of Mines, which represents mining companies and has promised to fight the new charter in court, on Tuesday met with ANC officials.

South Africa is the world’s biggest platinum producer. Companies including Anglo American PLC and AngloGold Ashanti Ltd have operations in the country.

The government should reach an agreement with mining companies on the way forward for the charter, South African Minister for Finance Malusi Gigaba said in a Bloomberg Television interview.

An accord is preferable to a court battle, which could become drawn out and damage economic growth, he said.

Ayanda Shezi, a spokeswoman for Zwane’s department, said she needed more details about Ramaphosa’s statements before she could comment.

The top six members of the ANC, which include Ramaphosa, agreed with the charter, Zwane said in an interview with South African Broadcasting Corp posted on Twitter.

Ramaphosa, who is seen as one of the top contenders for the leadership of the party, cofounded South Africa’s influential National Union of Mineworkers before helping to negotiate a peaceful end to apartheid.

He was one of the high-profile beneficiaries of early black economic empowerment deals, but disposed of some of his business interests after being chosen as deputy leader of the ANC.

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