Mineral Resources Minister, Mosebenzi Zwane, told around 1 000 of delegates at the annual Africa Downunder conference, in Perth, Australia on Thursday that investors were behind the mining charter.
The comments come as Statistics South Africa reported on Thursday that mining production had increased by 0.9% year-on-year in July 2017, from 1.3% in June with manganese ore, chrome ore, diamonds and gold being the largest positive contributors.
“I have met with several major investors, both foreign and local to unpack the details of the revised mining charter, and to listen to their operational and macroeconomic challenges. Out of our engagements, I can confidently report that all expressed their willingness to comply with the revised charter, and some have even willingly restructured their empowerment deals to reflect the new requirements,” said Zwane in his speech.
Zwane previously led provincial road shows to communities with a mining imbizo held in Middelburg, Mpumalanga in June ending in chaos after a hostile audience forced him to leave. Zwane also said the charter which was gazetted in June, was a aimed at addressing the country’s economic imbalances.
“The 2017 Mining Charter is law, and all right-holders in South Africa are expected to implement it,” he said. Zwane said that the timeframes for the achievements of targets in the charter as well as its objectives were clear.
“We are confident that with this regulatory tool in place, and the monitoring thereof by government, we are in a much better position to accelerate progress towards our stated objectives,” he said.
Despite Zwane saying investors were willing to comply with the charter, the Chamber of Mines the lobby group representing 90% of the industry by value, in June approached the court to have it reviewed saying it threatened the sustainability of the struggling industry.
The mining charter among others requires that new mining right holders increase from 26% to 30% black shareholding comprising employees, communities and entrepreneurs and for mining right holders pay 1% of annual turnover to black shareholders to as a special dividend.
Zwane was previously criticised after JSE listed mining houses lost R53bn in market cap on the day the charter was gazetted. He said in his speech that the Department of Mineral Resources had taken time to analyse the reaction of the markets, including the share prices of some of the major producers. Zwane said in fact the rand, as a commodity currency reacted to the movement of commodity prices.
“We are pleasantly surprised to see that some of the listed firms made gains, as opposed to what was expected by many. The mining industry is a long-term industry by its nature, and all serious and genuine investors understand this dynamic. We should therefore not be swayed by cyclical ups and downs that occur in the short term,” he said. – BUSINESS REPORT