Brenthurst Foundation signposts a way forward for Africa’s struggling mining sector

13th May 2016 By: Martin Creamer - Creamer Media Editor

Brenthurst Foundation  signposts a way forward for Africa’s struggling mining sector

Solving the current crisis in the African mining sector requires moving from the current series of tactical actions to a more cohesive, inclusive and strategic approach.

The intent must be to exit the current backward-looking, destructive, downward spiral in which mining is currently locked and shift to a positive, constructive cycle that offers a ‘win-win’ deal for all.

This view, laid out in the Brenthurst Foundation’s discussion paper 7/2016, outlines that, for a win-win deal to occur, all parties need to recognise the inevitable outcomes of the current cycle – the gradual deflation and downsizing of the industry.

Its Zambesi Protocol document – the outcome of a dialogue on natural resource policy in Africa by Africans – highlights the losers of mining’s fall as current and future workers, governments, populations and the mining companies.

The difficult issues that have underwritten the current crisis will need to be addressed and questions such as these answered: How should the historical legacy be dealt with, how much profit is reasonable and what is a mining company’s responsibility to its employees and communities?

Equally importantly in its view is that agreement be reached on what a successful mining industry looks like, while recognising that mining is an inherently risky and long-term endeavour.

For success and the mutual benefit that results, risk needs to be reduced, by all parties, as far as possible. But this needs to comprise more than an enlightened business case.

Mining, it says, also needs to understand the problems that government has to address and in so doing make a strategic contribution to wider issues of enterprise development, water, land and education in an atmosphere of collaboration, not confrontation.

Thus, the overall aim of such a strategy should be to make the mining industry a generational endeavour to the mutual benefit of all parties.

Brenthurst sees the ‘way’ as mining companies acting together in a more cohesive manner in their engagements with government.

Enough trust must be rebuilt between all parties to allow meaningful dialogue to occur.

It sees such rebuilding as needing more digestible information and a genuine attempt to explain the industry to all parties, using the full range of available media.

Once this has been achieved, a frank, open discussion needs to unfold on all the key issues that have contributed to the current crisis.

Finally, agreement will need to be reached on a way forward, to the mutual benefit of all.

Given that accurate information is so fundamental to the rebuilding of trust, verification by a reliable third party may be essential for such information to be trusted.

The thought leadership provided in the document of the Brenthurst Foundation, established by the Oppenheimer family in 2004, is timely and certainly warrants attention.