Mineral Resources Minister Gwede Mantashe
Photo by: Creamer Media
The mining and quarrying sector contribution to the gross domestic product (GDP) bode well for the sector and indicated a commodity boom may be imminent, Mineral Resources Minister, Gwede Mantashe, said on Tuesday.
Statistics South Africa said on Tuesday that mining and quarrying industry increased by 4.9 percent and contributed a positive 0.4 percentage points to GDP, led by mining of metal ores including platinum group metals, copper and nickel.
This was despite South Africa's economy slipping into a technical recession after contracting by 0.7 percent in the second quarter of the year, following a revised 2.6 percent shrinkage in the first quarter.
In a statement, Mantashe said the increase in mining contribution to the GDP was a good indicator for the sector against the background of recently-announced retrenchments and a decline in gold prices and demand for platinum.
As one of the leading mineral exporting countries, South Africa has been negatively affected by global economic factors and as a result, the mining industry experienced a decline in performance over recent years.
"Prioritising the exploration of new mineral deposits, and continuing to work together with the industry, we can turn our comparative advantage into competitive advantage, and ensure the sector’s positive contribution to growth of the economy is sustained," Mantashe said.
Mantashe also said this further reaffirms the importance of all partners in the industry working together to continue to contribute positively to the growth of the economy.