Gold industry enters final phase of slow death
The future is looking bleak for gold mines, with nothing to stop the inevitable decline of the once-mighty industry
Back in 1987, President Cyril Ramaphosa — then a 34-year-old labour union leader — led 300,000 black miners in a strike that symbolised resistance to the apartheid regime. Now, striking gold workers face a less politically charged battle, but one they cannot win. The 130-year-old gold industry — which has produced half the bullion ever mined on Earth — is locked in the final stages of a decades-long death spiral. Most gold mines are unprofitable at current prices.
Dwindling output has cut gold’s contribution to little more than 1% of the economy, down from 3.8% in 1993 — the year before democracy. While the industry’s demise won’t reverberate in the way it once would have, the mines minister has criticised Gold Fields’ plan to cut jobs as the ANC seeks to shore up its base before elections next year.