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06 Feb 2013 06:28
Mineral Resources Minister Susan Shabangu. (David Harrison, M&G)
This was a common theme at the Investing in African Mining Indaba on Tuesday, when speaker after speaker acknowledged that performance in the South African mining sector was weak compared to its global peers and that the country faced notable problems including labour unrest, legislative uncertainty and high energy costs.
This was despite Mineral Resources Minister Susan Shabangu in her keynote address drawing attention to the fact that the sector was seeing growth and job creation.
Roger Baxter, South African Chamber of Mines's senior executive of economics and strategy said South Africa despite being ranked highly for ease of doing business, talk of nationalisation created uncertainty for the sector even though the idea was ruled out.
Shabangu, obviously aware of concerns by investors, highlighted the initiatives presently being driven by government to make the sector for attractive for mining companies and investors.
These include the Mineral and Petroleum Resources Development Amendment Bill intended to remove ambiguities in the Mineral and Petroleum Resources Development Act, which led to uncertainty around interpretation. The Bill also plans to strengthen the administrative processes.
Reviews and licensing
Efforts to make licensing easier was also under way by integrating the process between the relevant processes.
Steward Nupen of the Mineral Corporation, speaking at a JSE presentation, said a prospecting review in South Africa took 252 days, compared to Botswana's 60 day target and Uganda's undertaking to conduct the review in week.
Delays in licensing could have serious repercussions for mining companies, particularly the smaller ones and could deter investors.
The minister said the Council for Geoscience had received more funding to increase geoscientific knowledge and greater skills development for the sector was also being prioritized.
Her speech was positively received by the industry, who saw it as a promising indication of government's recognition of the role mining continues to play in the country and in the economy.
Jonathan Moore, senior vice-president and managing director of the indaba said the fact that 7 500 people attended the event from around the world indicated that there was a lot of interest in investment in Africa and South Africa.
"Where investors chose to invest depends on their risk profile and how they weigh the benefits," he said.
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