South Africa’s Mines Minister Susan Shabangu said she is confident that a government-set ownership target for blacks in the mining sector would be exceeded and, if the process was done right, the policy may no longer be needed.
The government’s mining charter calls for 26 percent of the mining industry in Africa’s largest economy to be transferred to black owners by 2014 as part an empowerment drive to rectify the disparities of white apartheid rule.
“I am confident that we will exceed the 26 percent by 2014… We have seen progress,” Shabangu told Reuters on Saturday on the sidelines of a mining conference, Reuters reports.
Investors have been unnerved by nationalization talks by radical elements in the ruling African Nation Congress, which has focused attention on issues such as profits, safety and racial imbalances in ownership.
The industry has in the past made scant progress on the transformation process and an annual review of the industry on this score is currently taking place, a process Shabangu said was helping to keep companies on track.
“What we are saying is that every year we have got to go and do reviews,” she said.
Only 8.9 percent of mines were owned by blacks in 2009, well below a target of 15 percent.
Shabangu said changing or raising targets was not on the cards, but she wanted to see black-owned mining companies that were sustainable. If this was achieved, the empowerment policy in the industry might no longer be needed, she said.
“It’s about making sure whatever companies are there, are sustainable. As soon as they become sustainable they can roll on their own without necessarily setting targets,” Shabangu said.
One problem has been companies that got into the sector with little or no experience, that were not been viable or that were seen as fronts for white capital.
Mine safety is another major issue and Shabangu on Thursday said the pursuit of profits was behind amounting death toll in the industry.
The minister said she planned to publicly comment on a report submitted by the platinum industry on rock falls and fatalities.
“On the basis of that report we have to take steps to put into place to avoid or minimise rock falls in the platinum sector,” she said.
South Africa is the worlds largest platinum producer and a major supplier of gold and coal.