TORONTO (miningweekly.com) – South Africa will not adopt a policy of nationalisation of mines, the country's Mineral Resources Minister Susan Shabangu asserted in Toronto on Saturday.

There is also no intention to introduce “stringent measures” as part of the review of the industry Mining Charter, which was created five years ago to facilitate transformation in South African mining sector.

The mining industry is a vital part of the national economy, and the government wants to support the sector, not destroy it, Shabangu said at an event hosted by the South African High Commission in Canada.

“We do not have a policy of nationalisation,” she repeated several times during her comments.

Besides any other considerations, the idea is impractical because the State would have to pay for the assets it acquired from private companies, she commented.

“Those of you who have invested in the companies, we would have to pay you out.

“We've got many, many challenges as a country – we can't afford to pay you,” Shabangu said, prompting chuckles from her audience.

The African National Congress Youth League’s leader Julius Malema has in recent months repeatedly called for the nationalisation of the country’s mines.

After initial silence on the matter, both Shabangu and President Jacob Zuma have said in various forums that nationalisation is not government policy.

Like Canada, South Africa is a democratic country where debate is not stifled, Shabangu said on Saturday.

“But it does not mean ideas translate into policy.”

The country has no wish to once again isolate itself from the rest of the world, she said, in reference to sanctions and other restrictions placed on the country before the end of the Apartheid system.

STATE MINING COMPANY

Shabangu also said that the government's creation of a State mining company should also not be misinterpreted as a move towards nationalisation of the industry.

“What we are doing currently is we are consolidating those State-owned assets in the mining industry.

“And from there taking a decision on how do we want to move forward,” she said.

One of the main objectives is to make sure that the State can acquire strategic commodities for the country, Shabangu said, pointing to coal as an example.

“We need to be able to acquire coal deposits for the country for us to be able to generate power for the country.”

The Minister said she is currently working on a consolidation of all the government's interests in mining-related businesses and assets, and will submit the information to government.

“And then the government will make a decision as to what in the pot they want to keep, and what in the pot is relevant to what is intended as a State mining company,” she said.

“But the company will have to compete like any other company. It will have to register like any other company. It will have to be compliant like any other company.

“There is no intention of the State nationalising mining assets,” she reiterated again.

MINING CHARTER REVIEW

Shabangu confirmed that South Africa plans to publish the results of a review of the Mining Charter in the next few weeks, and said she is aware that there have been concerns about the review process.

The details will be released in the following weeks, after which Shabangu will immediately embark on an international roadshow “to place in context the Mining Charter and any changes that may arise”, she said.

“But may I caution, there is no intention of creating measures which are stringent in a way that will not be able to advance the interest of the mining industry.”

When government, labour and business in South Africa created the Charter in 2004 as a blueprint to transform the industry, it was agreed that its provisions of social and labour plans, skills development, employment equity, beneficiation and preferential procurement would be 
reviewed five years later.

Shabangu also confirmed that a mining sector tripartite task team would conclude discussions in the coming weeks, culminating in a summit before the end of this month.

The team includes representatives from government, business and organised labour, and was created to develop a strategy for growth and transformation in the industry.

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