M a r k e t N e w s

Three steps for mining’s national rebirth

Posted on : Wednesday, 5th October 2016

 THE Zambezi Protocol was developed on the banks of the river of that name at a meeting hosted by former Nigerian president Olusegun Obasanjo. Its opening lines state: "Africa’s mining sector is in crisis. At its root is a lack of trust between mining companies, governments and, indeed, the very nations they lead. A failure to tackle the crisis will result in serious, adverse implications for both economic growth and employment prospects at the moment when the continent’s needs are rapidly increasing."

The Zambezi Protocol challenges industry stakeholders to develop a vision of what a sustainable, successful industry should look like. And it challenges us to a great deal of introspection and honesty. I would like to suggest a three-step road map.
The first step is acknowledging our past. The mining industry was a flywheel in the development of the South African economy. The industry has played, and continues to play, a significant role in our national and regional economies. But can we honestly say our industry did the best it could for all stakeholders and that it acted humanely and morally? I must acknowledge that it did not.
The negative consequences — from migrant labour to job reservation and the lack of opportunity for women and people of colour — continue to be felt today, and will for generations to come. We need to critically and honestly reassess our role and unreservedly acknowledge the role of our industry where it acted against the interests of the vast majority of South Africans if we wish to secure full reconciliation with our broader society.
The second step is that we need to agree on a vision for the industry. The African Mining Vision was adopted by heads of state at the February 2009 AU summit, its basis being that Africa needs to "shift its focus from simply mineral extraction to much broader developmental imperatives in which mineral policy integrates with development policy". To do this, we need to build appropriate social and economic development linkages that meet national and regional developmental objectives. As noted in the vision, such linkages are diverse — "whether this is with regard to improving equity and transparency in revenue collection and distribution; integrating small-scale mining into rural economies …; or linking mineral extraction to infrastructure development and the manufacture of products that support societal needs".
The third step is the development of a social and economic compact that articulates the key principles on which the new relationships are founded. I envisage that business would be required to commit to open and transparent disclosure of information as the basis for meaningful engagement with all stakeholders. We would need to ensure that forums for stakeholder engagement are effective in promoting inclusivity and securing a sustainable future for mining operations. Business would need to adhere to exemplary standards of environmental and social performance and governance including, as priorities, aspiring to zero harm in respect of safety and health. The development of local economies and communities is an imperative. None of this is new, but we can and must improve many aspects of what we do.
More importantly, business will have to ensure that value flows equitably to all stakeholders according to an agreed and specific framework including employee benefits, profit sharing, tax, social expenditure and dividends to shareholders. We would hope that employees, unions, communities and the government would enter this pact with a similarly co-operative and engaging approach.
All South Africans have an interest in creating an environment in which the mining industry delivers on its potential in building a stronger nation. As stakeholders in the South African mining industry, our futures are inextricably linked.

Source : www.bdlive.co.za
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