Chamber of Mines
CEO Bheki Sibiya
Johannesburg, South Africa —18 December 2012 – The embattled mining sector will close marginal shafts and shed tens of thousands of jobs if delegates to the African National Congress’s elective conference in Mangaung decide to impose higher taxes on it.

BDlive reports that this warning came from Chamber of Mines CEO Bheki Sibiya, as the conference started talks prior to finalising decisions on policies that the government will then take on board.

One of the key discussions that will be closely watched in South Africa and abroad is on a new minerals regime for the country. While the nationalisation of mines is highly unlikely, the party will probably adopt a proposed mineral resource rent tax of 50% on profits above 15% of “normal returns”, and greater state involvement in the sector.

“It will mean a lot of marginal mines will need to be mothballed and, in terms of job losses, the probability is that it would run into the tens of thousands,” Sibiya said.

The mining sector, which employs about 500,000 people, lost 15,000 jobs in the third quarter after months of wildcat strikes that swept across mines. Some strikes ended in the fourth quarter, which means that the true effect has yet to be seen.

“Our engagement with the ANC will probably be more intense after Mangaung,” Sibiya said. The mining industry, represented by the chamber, has twice this year met senior ANC leaders “’ shortly before the August 16 police killing of 34 striking workers at Lonmin’s Marikana mine, and again more recently.

The resource rent tax was not discussed at the meetings because positions appeared to be entrenched, Sibiya added.

Source: BDlive. For more information, click here.