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Pushing South Africa forward, regulating to spur investment, righting investor perception

25th March 2016

By: Martin Creamer

Creamer Media Editor

  

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The need to redevelop Brand South Africa has been arising from various quarters in the face of South Africa’s potential downgrading by credit agencies. More South Africans are calling for greater government and business effort in pushing South Africa forward once again. Read on page 6 of this edition of Mining Weekly of top corporate leader Patrice Motsepe calling for steps to be taken towards the realisation of economy growth that is sufficiently strong to benefit the country’s entire population sustainably. To achieve this, he believes that a move to the political centre is essential in South Africa, along with a focus on what is in the best interests of job creation and business growth. Encouragingly, Motsepe sees the commitment at all levels being “in the right direction”. To watch a video on Motsepe’s outline of the need for government and business to move closer, scan the barcode on page 6 with your phone’s QR reader, or go to Video Reports on www.miningweekly.com.

The benefits of foreign investment are many but two of the most important when it comes to mining are the influx of capital to build mines and the earning of foreign exchange once the mines are built and operating. It is thus incumbent on governments to do their best to attract such investment for the benefit of their citizens. But, instead, South Africa’s regulatory environment foolishly continues to deter investors. Read on page 8 of this edition of Mining Weekly of Coal of Africa CEO David Brown calling for a reversal of this through the introduction of end-to-end processes that attract investors and State-owned enterprises also playing their part by, in the case of Transnet, providing rail tariff flexibility and, in the case of Eskom, by providing developmental clarity.

South Africans need to make an all-out effort to ensure that their country is seen as a friendly investment destination. Failure of some sections of government to help in this regard puts needless self- inflicted pressure on corporates doing roadshows abroad to attract vital money into the country. Read on page 12 of this edition of Mining Weekly of Sibanye Gold CEO Neal Froneman complaining about Sibanye’s shares trading at prices well below those of similar companies active elsewhere in the world. This has been the lament for far too long of many other CEOs, besides Froneman.

All this points to the urgent need for an economic turnaround of South Africa and a return to an emphasis on actions that promote business growth and jobs. But that clearly has to be preceded by a political turnaround, which is beginning to look more and more inevitable. Regrettably, as has been recently pointed out by former Opposition leader Tony Leon, South Africa has no record at all of any of its Cabinet Ministers ever resigning on a point of principle, which makes the prospect of a resignation speech highly unlikely. More’s the pity because every day that passes without strong new leadership adds to the delay of the country’s economy being set on a positive new course to reduce unemployment, narrow inequality and at least put a dent into poverty.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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