01 March 2018

All eyes on Minister Mantashe to resolve impasse in the mining sector

Submitted by: Teresa Settas

By Manus Booysen, a Partner in Webber Wentzel’s Mining Sector

President Cyril Ramaphosa’s appointment of Mr. Gwede Mantashe to the mineral resources portfolio is a positive development.  Mr. Mantashe is a senior man who comes from a mining background and has actually worked in the mining industry in various capacities, such as serving on the board of Samancor.  He is also very familiar with labour issues due to his involvement with the NUM and Cosatu, which is another major plus. 

Minister Mantashe, however, has his work cut out for him.  The mining industry is in desperate need of strong leadership which can pull the sector together to restore investor confidence.  It will need to be underpinned by clean and effective administration in abidance with the law and I do believe that Minister Mantashe is the man for the job. 

The mining sector is one of the foundational building blocks of South Africa’s much needed economic growth and development to turn around the spiral of unemployment and poverty.  Economic growth is fundamentally important for job creation.  The role of government is to establish a regulatory system and clean and effective administration to promote investment.  The rest will follow.  Performing this crucial task has been overdue for far too long.  The time is now!  I sincerely hope, and have no doubt, that Minister Mantashe will step up to the challenge.   

Two critical issues bedevilling regulatory certainty are Mining Charter III (the subject of litigation) and the MPRDA Amendment Bill which has been before parliament for 5 years now.  President Ramaphosa made it clear that the Mining Charter III impasse must be resolved out of court and that the MPRDA Amendment Bill must be finalised.  I am confident that Minister Mantashe has the ability to drive these processes to bring about an empowerment charter which has the support of the industry, labour and government. 

President Ramaphosa's call for finalisation of the MPRDA Amendment Bill is a further welcome development, considering that the process has been dragging for the past five years.  There are various concerns around the bill in its current form, such as proposed tender for application of rights to prospect and mine, as well as the proposed export licensing regime.  These issues have been a sword hanging over the heads of the mining industry, feared by investors.  Not only do we need Mining Charter III and the MPRDA Amendment Bill finalised but we need them finalised in a manner that will foster investment, and its effects - economic growth, job creation and eradication of poverty.

The eyes of South Africa and the world are on President Ramaphosa and his newly appointed cabinet to pave the way to a new era for our country and all its people.