The South African economy needs a national mining champion to inject new vigour into the economy as well as the mining board of the JSE.
The primary listing in London of Anglo American and the loss of the old Gencor assets into Australian hands have left the JSE with no domestic major big enough to stand toe to toe with nation-orientated giants like BHP Billiton, Rio Tinto and Vale.
Earlier this year, Mineral Resources Minister Ngoako Ramatlhodi said in an interview with the Financial Times in London that South Africa wanted a new national mining champion that was private- sector-owned and successful, re-echoing the earlier remarks of African National Congress (ANC) secretary-general Gwede Mantashe, who wrote in a guest column for Mining Weekly that the ANC would like a local mining champion that gives the sort of recognition to South Africa that Nestlé gives to Switzerland and General Electric to the US.
Now Sibanye CEO Neal Froneman says that Sibanye wants to be that company: “We’ve put up our hand to say we’d like to be this new South African mining champion because we’re moving into other commodities,” Froneman told Deutsche Bank mining analyst Anna Mulholland.
Mantashe has for long contended that South Africa’s JSE has been badly hurt by Anglo American taking its primary listing to London and the one-time primary-listed Gencor disappearing into BHP Billiton.
By contrast, the Australian government stopped BHP Billiton, which, ironically, is a South African co-creation, from dropping its primary Sydney listing.
Many global mining executives who end up in South Africa from other mining jurisdications are surprised that this country no longer has a primary-listed mining giant.
Australian Mark Cutifani, now CEO of Anglo American, was one of those who saw the gaping void and expressed a keenness during the early part of his tenure in South Africa to put Johannesburg back on the mining map by expanding the AngloGold Ashanti he then headed into a diversified major that could take on the biggest.
Of course, the South African mining champion will need a credible narrative to put to investors, which has to be underpinned by a credible legislative framework, which is currently absent.
It is thus incumbent on government to provide a world-leading legislative framework for the South African mining industry to ensure that maximum economic advantage can be gained from the $2.3-trillion worth of metals and minerals that this country still hosts, even after more than 120 years of mining.