Nationalising South Africa’s mines would be the country’s path to ruin and would drive away billions of dollars in investments, mining giant Anglo American’s chief executive warned on Tuesday.
“Mining companies simply will not invest if they cannot be assured that the assets they create will be secure,” Cynthia Carroll told an African mining conference in Cape Town.
“In ignoring this truth the false prophets who argue for nationalisation are advocating the road to ruin, a path we must not follow.”
African National Congress Youth League leader Julius Malema is pushing to nationalise the country’s mines, which produce 88% of the world’s platinum and 40% of its gold.
Long lead times
The government has repeatedly said nationalisation is not its policy, but the ANC last year agreed to research the issue amid insistent calls from the outspoken Malema.
The mining industry has called on the government to put an end to uncertainty about nationalisation.
“Mining lead times are long and companies need to be able to plan with confidence 20, 30, 50 years ahead, and the amounts involved are significant with the investments requiring billions of dollars,” said Carroll.
London-based Anglo American, which was founded in South Africa, is the country’s largest private-sector employer and generates between 2% and 2,5% of South Africa’s GDP, she said.
The South African Chamber of Mines warned in November 2010 that nationalisation had never been successful anywhere in the world.
President Sipho Nkosi told the annual general meeting of the chamber in Johannesburg that nationalisation was an “antiquated and discredited practice”, and that it had impoverished “many countries — several of them in Africa”. – AFP, Sapa