Is SA mining stumbling over cliff or migrating to better future?

15 September 2014, Bernard Swanepoel

As South Africans we are famous for talking. CODESA’s, Lekgotla’s, Indaba’s, working groups and conferences is what we do. Some would say that this has served our country and our industry well in the past as we navigated our way from the dark past to a democratic and inclusive future.

At last year’s Joburg Indaba, we talked. We talked about the South African mining industry – a series of blunt, honest, no-holds-barred conversations. Indeed, key industry players recognised ‘that unless the industry changes direction it is likely to fall over the cliff’.

There was broad consensus that the route to sustainability has to cater for:

• regulatory certainty around BBBEE and the MPRDA
• enforcing the rule of law to deter corruption and crime
• further progress in terms of safety
• understanding the common ground between the industry and the NDP
• uniting stakeholders on the need for productivity improvements
• more flexibility in terms of labour legislation
• acknowledging rational investors’ need for risk appropriate returns.

The same role players dreamed about the future where:

• mining is seen by all as a strategic cornerstone of the SA economy
• collectively we make the most of our natural endowment
• our diverse stakeholders align around these common goals
• management and organised labour re-discover how to engage constructively
• the industry invests through education in the next generation
• strong political leadership results in regulatory certainty
• employees are ‘proud to be miners’.

Since then, against a backdrop of continued fatalities, mine closures, retrenchments, community protests, corruption, illegal miners and copper thieves, acid mine drainage, Marikana, legal and illegal strikes, indiscriminate Section 54 stoppages, calls for nationalisation, inflexible work arrangements, declining productivity and insufficient returns for shareholders ( to name but a few), a cynic could argue that things have not only failed to improve but they have gotten worse.

I can’t help comparing our industry to the annual mass migration of wild animals over the plains of Africa: squeezed out by commodity prices, societal pressure and environmental and other legacy issues the industry hurtles towards the cliff with nothing but “scorched earth” in its wake.

Rather than standing on the sidelines – shouldn’t we be mapping out a shared route – “beyond the cliff” – to a sustainable future? Gwede Mantashe, (hopefully the new Minister of Mines), Frans Baleni, Mark Cutifani, Robert Friedland, Mike Teke, S Venkat, Neal Froneman, Fidelis Madavo, Peter Major, Jim Rutherford, Steve Phiri, Mike Schmidt, Sandy Mcgregor, Ben Magara, Norman Mbazima, Graham Briggs, Peter Steenkamp, Valli Moosa, Sipho Nkosi, Colin Coleman, Nick Binedell, Lloyd Pengilly, Pulane Kingston and many others, think we should.

On 8 and 9 October 2014 we gather again at the Inanda Club for the 2nd Joburg Indaba to discuss solutions, and to revisit the action plans formulated last year. An honest assessment will be made but it is very likely that our progress report will show limited and uncoordinated progress only.

I have spent a significant amount of time and effort trying to ensure that this years Joburg Indaba is even better, more honest and more blunt than last years. I care for the industry because it should be the cornerstone of a thriving SA economy. I invite you to join the conversation, comment on the progress made since last year and I would appreciate any inputs on what specific actions are required going forward in order to make the SA mining industry world class again.