Mosebenzi Zwane wants young to make use of ‘opportunities’ in mines charter
Mineral Resources Minister Mosebenzi Zwane plans to popularise the new mining charter among young people and would embark on provincial roadshows in the next two weeks "to raise awareness and take the charter to the people".
Speaking in Parliament during his budget vote debate in the National Council of Provinces on Wednesday, Zwane continued his defence of the controversial latest version of the charter, saying that young people "must exploit the opportunities to be unleashed" by what he called "this instrument of change".
The roadshows come as the Chamber of Mines prepares to interdict the charter and have it placed under legal review.
Released last week, the charter has caused panic and fury in the industry.
Among other measures, it plans to increase black economic empowerment (BEE) ownership in mines from 26% to 30% within 12 months.
The chamber and various stakeholders inside and outside the ANC have accused Zwane of pushing ahead with the contentious regulations without much consultation.
The chamber, which represents SA’s biggest mining companies, is looking to challenge the charter in court.
In his speech, Zwane said mining would remain the mainstay of SA’s economy for "100 years to come".
The continued growth of the sector thus offered government the opportunity to "break systematic poverty and inequality".
"The 2017 [mining charter] is meant to be a catalyst to build a more inclusive economy … it provides opportunities for young people … we encourage them to embrace it," he said.
The requirement that mining firms prioritise procuring equipment and other goods from black-owned enterprises will result in the localisation of supply chains and the growth of small and medium enterprises in townships and rural areas, Zwane said.
"The majority of people in SA remain excluded from the economy to the detriment of our inclusive growth efforts. Radical economic transformation is more urgent than ever before," said Zwane.
The charter also instructed all companies to pay their BEE shareholders 1% of revenue before they pay any distributions to shareholders.
Furthermore, the mining firms must acquire 70% of goods, up from 40%, and 80% of services (from the previous 70%) from BEE companies.
These requirements would add to operating costs for those miners not already in compliance if such new suppliers meeting these requirements were to charge higher prices, ratings agency Moody’s said.
Moody’s warned on Wednesday that the charter would worsen the credit ratings of SA’s miners because most of them would need to fund the increase in black economic empowerment shareholding with debt.
Trade union Saftu said on Wednesday "the hostile and hysterical reaction of the Chamber of Mines to the new Mining Charter … highlights everything that is wrong with the capitalist mining sector."
It called for the mining industry to be taken out of the hands of "white monopoly capitalists".