Close

South Africa should negotiate with mining companies over controversial new regulations that are supposed to help spread the country’s mineral wealth more broadly but have drawn clamours of outrage from the industry, Deputy President Cyril Ramaphosa said.

“Both parties must go back to the drawing board and they must sit down and talk about their shared interest, their shared future and how best they can reach a measure of consensus,” said Ramaphosa about the new Mining Charter at an event in Johannesburg.

“In the end, the mining industry needs investors but at the same time it needs to transform.”

The charter was released on 15 June by Mineral Resources Minister Mosebenzi Zwane and was immediately criticised by the industry, which says it wasn’t consulted and that the changes, including a higher minimum level for black ownership, will hurt investment.

Public disagreement about the new rules further highlights rifts in the country’s ruling party, which Ramaphosa is also deputy president.

The ANC last week expressed concern about the charter’s effects on employment and said it would seek an urgent meeting with Zwane. The Chamber of Mines, which represents mining companies and has promised to fight the new charter in court, met Tuesday with ANC officials.

Ramaphosa, who is seen as one of the top contenders for the leadership of the party, co-founded South Africa’s influential National Union of Mineworkers. He was one of the high-profile beneficiaries of early black economic empowerment deals but disposed of some of his business interests after being chosen as deputy leader of the ANC.

Finance Minister Malusi Gigaba said in a Bloomberg Television interview that the government should reach an agreement with mining companies on the way forward for the charter. He said, “An accord is preferable to a court battle, which could become drawn out and damage economic growth.”

 

Additional Reading?

Request Free Copy