Green shoots are starting to appear in the mining sector

“Hope is in the air. We can see the green shoots of optimism coming through.” This is the view of Roger Baxter, CEO of Minerals Council of South Africa (MCSA). Baxter was addressing the media on the state of the mining nation on the first day at Mining Indaba 2019.

Baxter explained that since the appointment of Cyril Ramaphosa as President coupled with Gwede Mantashe taking up the post of Mineral Resources minister, there has been intensive engagement between government and key stakeholders to get the industry back on track. Baxter added that at 1.2%, mining industry growth in 2018 was more than that of the national economy.

“The sector is estimated to have contributed R356 billion to GDP in 2018,” Baxter added. “In addition, mining exported 66% of its production to international buyers or commodity markets. At around $50 billion, these dollar earnings are equal to half of South Africa’s foreign reserves.”

Positively, employment grew in some sectors such as coal, iron, ore and manganese. However, weaknesses in gold and platinum resulted in a net job loss in the sector.

At the same time, Baxter cautioned against implementing Eskom’s proposed 15% tariff hike over the next three years. “If this happens, there will be no deep level mining and smelting and refining will take a huge knock,” he warned. He further urged government to look into restructuring the power utility, including rethinking its current workforce.

Baxter stated that he is pleased with the transformation that has taken place since the Chamber of Mines changed its name to MCSA. “We currently have more than 300 emerging and junior miners who are members of the Association.”

Addressing safety and health concerns, he explained that these will remain MCSA’s number one priority until the Zero Harm goal is realised.