President Cyril Ramaphosa said South Africa’s mining industry has undergone significant transformation over the past three decades.
He said this while delivering his keynote address at the Mining Indaba 2024 in Cape Town where the industry giants deliberated on issues in an attempt to find conjoint indulgence.
Ramaphosa highlighted that the mining sector during the apartheid regime was known for being brutal, oppressing workers, gross human rights violation and poor health safety standards.
“Today, miners employ approximately 476 000 people. Mineworkers can organise and rights are protected. A legal regime confers responsibility on mining companies to provide quality services and promote development in the communities where they operate. There are also many employee share ownership schemes through which mineworker participation in mining companies is being promoted,” the president said.
“For nearly 150 years, mining has been a pillar of the South African economy. It currently contributes roughly 7.5 percent towards GDP and accounts for some 60 percent of South African exports by value. In 2004, when the Mining Charter was first introduced, black ownership in the industry stood at some 2 percent. Today this stand at approximately 39 per cent.”
He said illicit mining cable theft and infrastructure vandalism place a further strain on mining output and returns. “We are committed to working hard and working together to overcome these serious challenges,” confirmed the ANC President who said his administration last year outlined four objectives to enhance the mining sector.
“The first is to achieve a secure supply of electricity. The second objective we identified was to accelerate economic reforms to improve the operating environment. The third objective we identified was to tackle illegal mining and damage to infrastructure. “Finally, we committed in 2023 to improve the regulatory environment by developing and putting in place a new cadastral system to assist in operating a modern mining rights administration system,” Ramaphosa said.
While acknowledging that the mining sector plays a pivotal role in boosting the economy of the country, he said his administration has embarked on “Our Just Energy Transition Investment Plan” which summaries a pathway to create new industries and support more livelihoods in the green economy.
“The delivery of this plan is premised on strong collaboration between government and all social partners. It cannot be overstated how crucial the mining sector is to the success of just outcomes, notably in regions like Mpumalanga,” Ramaphosa said.
President Ramaphosa, the political ally of Mineral Resources and Energy Gwede Mantashe sketched the headwinds in the mining sector, both globally and locally.
“We are all acutely aware that we face strong headwinds, and several persistent challenges are impeding mining performance. Globally, commodity price volatility, high energy prices, geopolitical tensions, and a global cost of living crisis are playing a significant role in dampening the business operating environment.
“Domestically, the energy crisis and port and rail bottlenecks are putting serious pressure on miners’ operational costs. Illicit mining, cable theft, and infrastructure vandalism place further strain on mining output and returns.
“We are committed to working hard and working together to overcome these serious challenges. Last year, we outlined four objectives to develop the sector, improve its global competitiveness, and harness the global drive towards sustainable development.
Minister Mantashe said the mining sector saw some tail winds, with sizeable investments in new mining and extensions of existing mining operations.
“A significant number of the new mining operations are concentrated on industrial mineral mines, diamond mines (alluvial), coal, manganese, iron, gold, platinum group metals, chrome, copper, lithium, and other precious metals,” the minister added.
Reportedly the Department of Mineral Resources and Energy (DMRE) is monitoring the implementation of R400 billion mining projects committed at various investment conferences between 2018 and 2023.
In relation to the licensing backlog, Mantashe said significant progress has achieved.
“Of the 2,000 applications received since the beginning of the Financial year, the DMRE has granted: 268 prospecting rights, 32 mining rights, 85 renewals, 184 amendments, and 190 permits. I have directed the department to work with the necessary speed to wipe out the licensing backlog within this calendar year,” Mantashe said.
“It would be remiss of us not to acknowledge the challenges confronted by the industry as a result of these historical backlogs. We are, however, buoyed by the unwavering support and patience from the mining industry.”
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