Investors in South Africa urge policy certainty ahead of new mining charter

Sep 02, 2018

South Africa aims to publish a long-delayed mining charter by November, the mining minister said on Friday, finalising a law that has been hotly disputed between the industry and government.

The mining industry in Africa’s most industrialised economy is facing a wave of job cuts due to low global commodity demand, high wage costs and a volatile labour environment.

Mining companies have warned that any change to the law should not hurt industry. A period for the public to submit comments ends on Friday before government consolidates the final law.

Mining minister Gwede Mantashe said in a statement the contributions made during the public hearings had been useful. 

“It is envisaged that the final Mining Charter will be published for implementation by November 2018, in order to entrench the necessary regulatory certainty,” he said.

Investors seek policy certainty

Policy certainty could add 122 billion rand ($8 billion) in capital expenditure to the mining sector over the next four years, an official representing companies said on Thursday. The last draft of the law contained regulations meant to redress imbalances of the nation’s past apartheid rule and stipulates rules for miners. The new rules could mean significantly higher taxes and levies on mining companies.

Investors are also watching the country as it debates calls for land expropriation without compensation. More than two decades after the end of apartheid, white people still own most of South Africa’s land.

South Africa’s ruling ANC plans to amend the constitution to redistribute land , but this has been interpreted negatively by some investors, who see the plan as undermining property rights.

The ANC has sought to allay those fears, saying land reform will follow a parliamentary process.


REUTERS

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