LETTER: SA would do well to build its brand

By chance your thought-provoking editorial opinion coincided — should that be collided? — with an important and related global event (“Is SA (still) open for business?”, April 24).

The thrust of your editorial was the tone deaf attitude of government to the demands — yes, they have them — of potential inward investors. The example given was the mineral resources minister continuing to strangle the industry with red tape. Seemingly a work in progress.

There is a perception among many in SA that the mining industry is the cornerstone of the economy and a global giant. Historically that might have been the case, but today the reality is rather different.

Today just 6% of the country’s GDP comes from mining. The global event I mentioned above is the release of London-based management consultants Brand Finance’s annual mining, mineral and metal brand rankings. There are no SA companies in the top 50. Some would suggest Anglo American and its subsidiary De Beers, but since 1999 its main listing has been on the LSE and it is domiciled in Britain. For interest’s sake, it ranked 18th.

Top of the rankings is Glencore, valued at $6.2bn, followed by BHP ($5.1bn) and Rio Tinto ($3.8bn). The 50th brand valued at $476.6m. In the annual rankings of SA’s Top 100 brands there are 10 miners, all in the bottom 50, led by Amplats with a value of $369m.

Many local miners remain rooted in the world of commodities, while globally the importance of branding and reputation management have long been recognised and practised and an expenditure item.

I recall being involved in a global project with Rio Tinto more than 15 years ago. Building a strong brand brings many benefits to the owners and applies from countries to people and everything in between. While important, it is so much more than investor relations.

In your editorial you mention the many, often bizarre, impediments to doing business in SA. A modicum of common sense would assist the government in smoothing the pathway and being more friendly to the private sector.

For inward investors the world is their oyster; they have choices and they want certainty, and in the world of mining that can be 20 years-plus. There are many opportunities to invest in other countries where the powers that be will want to optimise their natural resources and be more accommodating, perhaps even seductive.

Jeremy Sampson
Illovo

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