GOLD 1216.40 $/ozChange: -0.63
PLATINUM 1339.00 $/ozChange: 4.00
R/$ exchange 11.08Change: 0.00
R/€ exchange 14.20Change: 0.11
We have detected that the browser you are using is no longer supported. As a result, some content may not display correctly.
We suggest that you upgrade to the latest version of any of the following browsers:
close notification
powered by
Advanced Search
Breaking News
Shabangu announces gold, platinum rescue plan
Embed Code Close
28th May 2013
Text Smaller Disabled Text Bigger

JOHANNESBURG ( – Mineral Resources Minister Susan Shabangu on Tuesday announced that her department would develop a rescue plan, aimed at placing South Africa’s wrecked platinum and gold sectors on a recovery path.

Delivering her department’s R1.39-billion Budget Vote in the National Assembly, she said Department of Mineral Resources (DMR) officials had been instructed to “urgently” look at a rescue plan for the gold and platinum sectors, focusing on supply- and demand-side interventions.

“The platinum and gold sectors, which are among the largest sectors of our mining industry in terms of employment, investment and revenue generation, are negatively affected by the persistent global economic environment, which has an adverse bearing on their long-term viability,” the Minister said.

Shabangu stated that South Africa’s recently concluded bilateral agreement with Russia, under which the countries agreed to cooperate on platinum group metals (PGMs) initiatives, would contribute to the creation of a suite of interventions necessary to stabilise the platinum industry.

“I invite PGM companies to work with my department to leverage the relations we have established with the Russian Republic.”

The news of a gold and platinum rescue plan comes as the world’s top platinum producer, Anglo American Platinum (Amplats), is contemplating thousands of job cuts in South Africa as part of a large scale restructuring process.

Amplats initially planned to shed 14 000 jobs, but following a meeting between President Jacob Zuma and the company’s chairperson Sir John Parker, job cuts had been reduced to 6 000.

Last week, Amplats, the DMR and labour unions announced that they had agreed on measures to preserve jobs. Trade union Uasa said on Tuesday that Amplats would now limit job losses to 1 300.

In her Budget Vote address, Shabangu also reflected on her meeting with mining executives on Friday, where the parties agreed on a programme of action to deal with the problems facing the industry. She described the meeting as a “bold and decisive action” to deal with a “crisis of perception” of both the country and the mining industry.

“This process that was established at the Friday meeting is scheduled to conclude its initial tasks and provide a progress report within a month.”

Commenting on wage talks in the mining sector, Shabangu called for responsible negotiations.

“We should all take responsibility and accountability for the success of these negotiations. For, if we do not grasp the nettle, we run the risk of losing jobs and further fuelling negative perceptions that are being used to run our country down at the most inopportune time.”
Despite labour relations challenges and cyclical downturn, the Minister said the medium-term outlook for the South African mining industry remained “extremely attractive”.

However, Democratic Alliance spokesperson on mining James Lorimer said in the budget debate that the country’s mining sector had “slid from the uplands of viability to the trough of failure,” with the African National Congress shuffling from one “disastrous policy choice to the next.”

He highlighted that while many local mineworkers had lost their jobs, as many as two-thirds of South African platinum mines were losing money. Adding to Lorimer’s concern was the fact that the platinum index had hit a seven-year low, while mining output was down 12.7% last year.

“We have slid another ten places on the Fraser Institute index of attractiveness for mining investment and we are now the sixty-fourth most desirable destination for mining money, two-thirds of the way down the table,” he added.

Lorimer further slammed government’s Mineral and Petroleum Resources Development Act Amendment Bill, which was said to be geared toward improving the industry, as being “set to squeeze more out of the industry, while making operating conditions even more onerous.”

“It will dry up our already shrinking pool of mining investment. The government will earn less tax and more people will lose their jobs,” he warned.

Edited by: Mariaan Webb


To subscribe to Mining Weekly's print magazine email or buy now.

FULL Access to Mining Weekly and Engineering News - Subscribe Now!
Subscribe Now Login
Susan Shabangu
Picture by: Duane Daws
Susan Shabangu