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Mining Charter breakthrough as SA moves in investor-friendly direction – Solidarity

EDINBURGH — South Africa is perking up under President Cyril Ramaphosa. After firing the starting gun on a corruption crackdown, Ramaphosa turned to the Mining Charter – a significant obstacle in the way of boosting economic growth. Negotiations have got off to such a good start that even Solidarity, a union that has often criticised ANC policies, has publicly stated its approval about the direction of discussions. South Africa is rich in minerals like coal, diamonds and gold but its mining industry has been under pressure, with high costs and regulatory uncertainty among the factors weighing it down. According to Statistics South Africa, mining contributes less than 10% to gross domestic product – a far cry from the 21% it accounted for in 1980; nevertheless, it remains an important sector, employing one in every 40 working individuals. – Jackie Cameron

Good start for Mining Charter negotiations; social dialogue returns to mining sector – Solidarity
Solidarity

Negotiations on the draft Mining Charter started this weekend under the direction of Gwede Mantashe, Minister of Mineral Resources, and Godfrey Oliphant, his deputy. Apart from Amcu, all interested parties, including mining trade unions Solidarity, the NUM and Uasa, the Chamber of Mines, SAMDA, members of the Portfolio Committee on Mineral Resources and key officials and advisors of the Department of Mineral Resources were present.

“While the role players were unanimous as to the importance of the mining sector and the challenges the sector has to overcome, robust debating about burning issues contained in the draft mining charter took place. Especially the status of the draft mining charter that led to many court cases, new forms of “taxes” that are proposed in the charter, and ownership of mines generated hot but constructive debating,” Gideon du Plessis, Solidarity’s general secretary said.

According to Du Plessis, it was also the first time in almost two years that the principals of the respective interested parties sat down to reflect on important mining matters after the previous Gupta minister, Mosebenzi Zwane, had undone all consultation structures instituted by his predecessors. “Fortunately, vital social dialogue was revived this weekend and it was also a unique occasion due to the fact that members of the Portfolio Committee were involved in the negotiations as part of their oversight role,” Du Plessis said.

Newly-Elected Minister of Mineral Resources Gwede Mantashe. Photographer: Waldo Swiegers/Bloomberg

As a result of the weekend’s negotiations, a mining charter task team and a competitiveness task team were established. The mining charter task team, consisting of representatives of all interested parties, will try to settle as many as possible of the differences between the parties and to produce its first report by 10 April 2018. All parties committed themselves to the finalisation of the charter within the three-month timeframe agreed upon by Minister Mantashe and President Cyril Ramaphosa. “This weekend some agreements on certain changes to the draft charter have already been reached in principle, giving momentum to the process. During the negotiations, Solidarity emphasised, among other things, the retrenchments that may arise from the charter as well as the unconstitutionality of the charter’s provisions that appointments must be made on the basis of national demographics and white employees be excluded from employee stock ownership plans (Esops). In reaction to this, the government representatives acknowledged that the Esop clause was problematic and that it would have a divisive effect among employees,” Du Plessis explained.

Read also: Peter Leon: Here’s how SA should craft its new mining charter

According to Du Plessis, the competitiveness task team will initially consider the impact of the charter on the mining industry but after implementation of the charter the task team will become a standing committee focusing on aspects that will improve competitiveness and sustainability in the mining industry.

“The fact that Amcu did show up at the negotiations is no longer a matter of concern for the role players because it has become the pattern since Amcu’s arrival on the scene in 2012 after the Marikana incident. Amcu will still be invited to all meetings but ultimately it will be Amcu’s members who will have to reflect on the Amcu leadership’s decision to boycott the process regarding the writing of the all-important mining charter,” Du Plessis said.

“In addition, Minister Mantashe indicated that mining communities, and especially community leaders, will be consulted during a road show to ensure that the current trust deficit between mining communities and the rest of the mining industry is dealt with,” Du Plessis added.

“Mantashe’s knowledge of the mining industry was visible this weekend and he led from the front. Mantashe also reiterated the government’s commitment to the recovery and growth of the mining industry,” Du Plessis concluded.

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