Mosebenzi Zwane, South African Mineral Resources Minister failed to adequately address the ongoing regulatory uncertainty bedeviling the mining sector when he opened an annual conference on Monday, a legal expert in the industry official said.
Mining companies operating in South Africa say uncertainty over policy and the regulatory environment has held back investment in the sector, and have slammed a mining charter Zwane unveiled last year as impractical.
Peter Leon, Herbert Smith Freehills Africa practice Partner and Co-Chair says Zwane’s speech at the 2018 mining indaba failed to allay the uncertainties.
“The Minister rather surprisingly claimed that the government had created an enabling environment for mining,” says Leon.
“Not only did the minister not expand on this, but said nothing about the contested mining charter, now the subject of a judicial review later this month by the Chamber of Mines or the MPRDA (Mineral and Petroleum and Resources. Development Act) Bill, which has lingered in parliament for the last five years.”
He warns that South Africa would fail to capitalise on a recovery in commodity prices over the last year unless the government implemented measures to address the issues deterring investors.
“Government urgently needs to create a proper enabling environment for mining in South Africa and will only succeed in doing so if it formulates a comprehensive strategy to lift the mining industry out of its current crisis and set it on a new path based on mutual understanding and benefit among all stakeholders,” adds Leon.