The endorsement of South Africa as an investment destination by Goldman Sachs is an important one. There are few investment banks, if any, that do more number crunching and data analysis than this large bank, which is bullish on South Africa as a favourable destination for fund managers. Still standing strongly enough in South Africa in the face of many challenges is this country’s private sector in general and the JSE in particular. Read on page 13 of this edition of Mining Weekly of the bank being impressed by the JSE’s capital depth, with Goldman Sachs International MD Colin Coleman making the point that we have one of the deepest capital markets when the JSE market capitalisation is divided by South Africa’s gross domestic product. Also benefiting the country is its link to the 800-million-population sub-Saharan Africa, which is forecast to grow at 5% this year. “So, self- inflicted wounds aside, this is a world where we have sub-Saharan Africa at our backs, emerging market scarcity pointing to South Africa and the JSE, and very well-run and governed companies being the platform for playing that growth,” Coleman commented, his endorsement being made with full cognisance of South Africa’s weak 2% Treasury-forecast growth rate, Eskom’s snarl-ups and rampant xenophobia. Goldman Sach’s view is that South Africa has base capacity to grow at a rate of 3.5% a year and, if the basics are done, by 5% a year.
The decision by government, industry and labour to ask the High Court for an interpretation on the Mining Charter’s black-ownership position is winning plaudits. International law firm Hogan Lovells mining head Warren Beech describes it as both sensible and mature. Read on page 7 of this edition of Mining Weekly of the parties wanting the courts to determine the validity of the ‘once empowered, always empowered’ principle. The standpoint of the Department of Mineral Resources (DMR) is that, once a black economic-empowerment (BEE) partnership ceases, another must be put in its place so that a 26% black-owned threshold can pertain in perpetuity. Mineral Resources Minister Ngoako Ramatlhodi reasons that it was better to seek the wisdom of the courts than to impose a unilateral decision on a contentious issue. He sees it as the shortest route to certainty, even if appeals follow. Effectively, the parties are dealing with a 2004 interpretation versus what is meant now, which is the point of law submitted for clarification.
Jaco Schoeman, the operations director of DRDGold’s Ergo Mining, which requires volumes of water for the recovery of gold from surface material, is calling for an effective approach to the acid mine drainage (AMD) issue. Read on page 15 of this edition of Mining Weekly of his calculation of the gold mining industry spending R75-million in research, documentation, specialist studies and pilot plants in the last seven years to arrive at a long-term solution for AMD. He proposes that the AMD challenge be dealt with effectively by commercialising water within a regulatory framework, despite resistance to this idea in the past. Already developed by the mining industry are several new technologies, aimed specifically at combating AMD. An offer made to the Department of Water Affairs five years ago but not taken was a fully trans- parent, open-book approach to running costs. He emphasised that past proposals by the mining industry were never about a privately owned company selling water to the public but were aimed at providing government with funding, as well as developing water management with government not having to surrender its control over AMD water resources.