Mining has long been considered the backbone of the South African economy but could it have done more since the end of apartheid to address development. The Minerals Council South Africa CEO Roger Baxter elaborates on private sector initiatives to address sustainability and drive growth in the sector.
South Africa has a lot of potential, even though the majority of it has not been realised. We are blessed with characteristics which differentiate us from our neighbouring countries, such as the constitution and a strong financial services sector. These are two prime examples of the unrealised potential, mainly because a large chunk of our time post-Apartheid has been spent developing basic structures for services and education.
The private sector, which has been a continually leading light, has been intensifying their focus on development by working more closely in collaboration with all stakeholders. In this regard, private leadership has really begun to stand up and take more responsibility rather than point the finger. We understand that we are all in the same canoe, so it is important that we all come together when trying to patch the holes that are there.
Doubling sector investment
Collaborative changes need to be developed to create real change towards the vision of re-doubling investment by 2030. If we want to be competitive we need to first develop a real understanding of the resource pool available. We have not seriously conducted a mapping of our geography since the 1970’s and 80’s, and a good starting point would be to look at what our real potential is. Australia’s mining sector has never looked back after they conducted a full-scale search into their potentiality.
From a global perspective, it is clear that countries that have seen greater participation in solutions from their private sector creating a much greater growth rate within their countries. Furthermore, we have seen a green energy revolution for South Africa in the renewable energies space, specifically in the solar space over the last three years. There has been quite a large amount of capital investment here. However, the big takeaway is that when you get the private sector involved you get a much greater vibrancy; economic vibrancy generates greater efficiency, innovation and competitiveness. Therefore the greater the role the private sector plays in the country’s growth and solutions the more balanced the growth rate will be and the outcomes for the country will improve.
We are quite passionate about working with different procurement managers to get as much localised production as possible. We still import a fair amount since a lot of our domestic production capabilities were hollowed out during Apartheid, except that which was defined to be self-sufficient. Now we are working closely with government to help bring back businesses into the market here in order to create a larger domestic footprint, which includes an empowerment focus. This would translate back into supply parks to be able to provide goods and services to move into emerging African economies and the African mining economy because of the great potential here.
Outlook for the future of mining in South Africa
The key signals of getting a better regulatory environment in the South African mining sector are the building blocks of achieving that. For example, the Mineral and Petroleum Resources Development Amendment Bill is critical legislation in fixing the old traditional laws created for the mining sector. We have been working with government at looking at the challenges and the court process together to get clarity on the interpretation of the mining charters’ ownership element and we are pretty confident that we will find solutions that are in the interest of government and industry.
On a leadership level, business is stepping up to the plate. Business is playing a more active leadership role in the discourse of South Africa. No longer can we just leave the politics to politicians. You can look at what the former Minister of Finance, Pravin Gordhan, did in spearheading the drive to avoid the Moody’s downgrade initiative. It shows that the private sector is standing up to responsibilities and making a difference for the country. I am very encouraged by that.