Indaba preview
Inside the pressure cooker
Uncertainty has hampered President Cyril Ramaphosa’s efforts to lure foreign
investors to South Africa, writes Leon Louw.
G
rowth in the South African
mining industry remains sluggish,
almost a year after President
Cyril Ramaphosa took over as leader of
the ruling African National Congress
(ANC) and president of the country.
Despite significant reforms to lure foreign
investment, and candid attempts to
eradicate corruption, Ramaphosa’s ‘New
Dawn’ does not seem to be enough to
entice foreign mining companies to explore
the abundant South African deposits.
The biggest concern (apart from all
his other worries) for Gwede Mantashe,
the South African Minister of Mineral
[14] MINING MIRROR JANUARY 2019
Resources, should be the lack of new
exploration projects. In a country that
boasts first-class infrastructure and
spectacular geology, this means that
exploration companies consider South
Africa as high-risk territory, and that
the level of uncertainty trumps the
good geology. Mining jurisdictions in
other parts of Africa have become more
attractive to junior mining companies,
despite their shortcomings in terms of
infrastructure and, often, political, social,
and security risks.
The health of a country’s mining
industry — and its attractiveness to
foreign investors — should be measured
in terms of the number of geologists
active in the field. Moreover, the number
of new, greenfield projects that are
developed from scratch is an indication
of where the country’s mining industry
is heading. Sadly, South Africa falls
short. Compared to the rest of the
continent, the country’s share of new
junior mining companies actively
involved in greenfield exploration is
meagre. Although there has been some
movement in South Africa in terms of
mergers and acquisitions, a very small
number of new mines have come online.
www.miningmirror.co.za