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Business In The News South Africa

SA mining industry says current legislation is toxic for the country

JOHANNESBURG, December 14 – The Chamber of Mines of South Africa said on Thursday that the country’s current mining legislation was creating a “toxic” environment that is severely impacting mining potential” and hampering economic growth.
This comes after the chamber published a report of the findings of an aggregated survey recently conducted amongst its members in an attempt to understand the investment and employment potential of the mining industry in the event of a return to better practice in policy, legislation and regulation formulation.
The Chamber looked at what could happen if the policy, regulatory and governance environment improved substantially and enabled the South African mining industry to return to the top 25 percent of global mining jurisdiction.
It highlighted uncertainty in policy and the regulatory environment, the release of the government’s Reviewed Mining Charter and the failure to finalise the Mineral and Petroleum Resources Development Act (MPRDA) Amendment Bill as stumbling blocks to investment.
It said that the inappropriate use of work stoppages and serious allegations of corruption and state capture were contributing to the malaise that has resulted in the South African mining industry placing a freeze on investment in new projects.
In total, 16 member companies representing many mining operations across various commodities responded to the survey.
The chamber said the responses to the survey offer an indication of the impact of the current regulatory environment, including that planned capital spending in the mining sector of R145 billion could potentially increase by R122 billion or 84 percent in a more stable and conducive environment.
The chamber’s chief executive, Roger Baxter, said that the economic and transformational opportunity cost of the current environment was detrimental to all South Africans.
“The findings of the survey illustrate that if the leadership focus in South Africa was shifted to creating an attractive policy, regulatory and governance environment – through ethical leadership, good governance and the adoption of competitive, stable and predictable policies – considerable new investment in mining can take place,” Baxter said.
“This would create huge economic and transformation benefits for the country and the multiplier effects would be profound. Not only would this result in a significant growth in annual investment, but there would be a sizable increase in jobs, export earnings, GDP and, importantly, transformation.”
African News Agency (ANA),

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