As South Africans we are famous for talking. CODESAs, Lekgotlas, Indabas, working groups and conferences is what we do. Some would say that this has served our country and our industry well in the past as we navigated our way from the dark past to a democratic and inclusive future. Add to that the inherent optimism of those in the mining industry and you can get a lot of bullish hot-air on any topic related to the mining industry.
By Bernard Swanepoel
At our first Joburg Indaba, we talked. We talked about the South African mining industry – a series of blunt, honest, no-holds-barred conversations. Indeed, key industry players recognised ‘that unless the industry changes direction it is likely to fall over the cliff’.
I couldn’t help comparing our industry to the annual mass migration of wild animals over the plains of Africa: squeezed out by commodity prices, societal pressure and environmental and other legacy issues the industry hurtles towards the cliff with nothing but “scorched earth” in its wake.
Last year’s Joburg Indaba built on that. Both the conversation and the anology of the migrating herds moved on to the topic of modernising our very stale and conventional industry. We started to flesh out what it will mean to co-exist in this land of possibility. Where society sees us as a strategic industry and where concepts like productivity, profitabilty, legitimate, competitive and sustainable start to describe a more positive narrative foe mining.
There was broad consensus that the route to sustainability has to cater for:
- regulatory certainty around BBBEE and the MPRDA;
- enforcing the rule of law to deter corruption and crime;
- further progress in terms of safety;
- understanding the common ground between the industry and the NDP;
- uniting stakeholders on the need for productivity improvements;
- more flexibility in terms of labour legislation;
- acknowledging rational investors’ need for risk appropriate returns.
The same role players dreamed about the future where:
- mining is seen by all as a strategic cornerstone of the SA economy;
- collectively we make the most of our natural endowment;
- our diverse stakeholders align around these common goals;
- management and organised labour re-discover how to engage constructively;
- the industry invests through education in the next generation;
- strong political leadership results in regulatory certainty;
- employees are ‘proud to be miners’.
Since then, against a backdrop of continued fatalities, mine closures, retrenchments, community protests, corruption, illegal miners and copper thieves, acid mine drainage, Marikana, legal and illegal strikes, indiscriminate Section 54 stoppages, calls for nationalisation, inflexible work arrangements, declining productivity and insufficient returns for shareholders (to name but a few), a cynic could argue that things have not only failed to improve but they have gotten worse.
Falling commodity prices, weakening balance sheets, despondent and disappointed investors makes the previous ‘perfect storm’ look like a mere thunder storm. The recently announced leadership declaration on job losses in the mining industry, described by some as re-active, acknowledges that the industry needs to go through a very painful but necesaary re-adjustment process.
The President is also regularly interacting with industry participants, but time would tell what comes out of that. Once again, the industry seemed to have dropped a ball when the Davis Tax Commission made further negative tax recommendations, seemingly with the COM and other experts assuming the industry is dying.
On 14 and 15 October 2015 we gather again at the Inanda Club for the 3rd Joburg Indaba to discuss solutions, and to revisit the action plans formulated last year. An honest assessment will be made but it is very likely that our progress report will show limited and uncoordinated progress.
With my colleagues of Resources for Africa, I have spent a significant amount of time and effort trying to ensure that this year’s Joburg Indaba is even better, more honest and more blunt than last year’s. I care for the industry because it should be the cornerstone of a thriving SA economy, creating good jobs for thousands of South Africans.
I invite you to join the conversation, comment on the progress made since last year and I would appreciate any inputs on what specific actions are required going forward in order to make the SA mining industry world class again.
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