Latest Mining Charter puts off investors – Helen Suzman foundation
'The assumption is that the mining industry makes more than enough money to fund any government requirements, which makes no economic sense.'
Silhouette of a mine shaft with the sun setting in background.
The Helen Suzman Foundation (HSF) has cautioned that the recently published version of the Mining Charter made it unattractive for investors to put their money in South Africa.
The HSF was the first to respond and offer an alternative to the latest mining policy proposals by the department of mineral resources (DMR).
At the core of HSF’s divergence with the DMR on the latest version is a proposal for mining houses to offer shares to employees, communities and black economic empowerment entrepreneurs.
HSF’s Anton van Dalsen said the degree to which mining houses should comply with the charter prescripts were “unclear” and that “procurement restrictions on services are even more stringent”.
The charter aims to ensure that government attains its objectives of redressing historical, social and economic imbalances, in line with the constitution.
“While we support these aims, the problem remains one of conflicting philosophies between government and the private sector, coupled with South Africa’s current economic situation,” said Van Dalsen.
“The assumption is that the mining industry makes more than enough money to fund any requirements that the government may wish to place on it.
“This makes no economic sense, especially when a stagnating economy needs policy measures to boost growth and employment.
“A more sensible approach would have been to come to an agreement with the mining industry on how to fund the requirements of the Mining Charter.”