‘I’m deeply disillusioned with SA’: Sibanye-Stillwater CEO Neal Froneman on investing

Sibanye-Stillwater CEO Neal Froneman is known for his no-nonsense approach. In a recent Rational Radio Webinar, the seasoned mining executive showcased just that – explaining to BizNews founder Alec Hogg, David Shapiro and Peter Major why he feels the way he does about investing in South Africa. – Jarryd Neves

Neal Froneman on investing in South Africa

I’m deeply disillusioned with South Africa. Investing more in South Africa is very difficult. I’ve been quoted as saying, you can’t speculate with shareholders money. It is very sad for me as a South African to say that. But, there are better places to invest shareholders money in the mineral sector than in South Africa.

On what would change his mind about investing in SA:

We need some significant leadership. I’ve seen the recent plan. I’ve been part of business, in terms of trying to convince government to do the right things. I remain completely concerned. The current plan that is being put out is all endogenous. In other words, everything is within South Africa. There is nothing that addresses the external perception and creates an environment where external investors would bring money. It’s all driven by us spending. I don’t believe we can spend. I believe we are bankrupt. It’s just a matter of time before we as a country hit the wall.

On what is needed:

Some very, very tough decisions. For instance, investment friendly decisions. The commentary about expropriation without compensation. That just does not fly anywhere in the world – except in countries like this. It’s wrong. It’s absolutely wrong. Maybe there are some different words that can be used, but the fact that government continues to use words like that – and yes, I understand the historical legacies, I’m not saying that they don’t have to be addressed – it is not investor friendly.

On policy certainly within the mining sector:

There’s a lack of certainty. We have court cases. Those court cases have to continue. Government will say, ‘well drop the court cases and you’ll get regulatory certainty.’ No, we won’t. We will look after our shareholders and we will take it all the way to the constitutional court if we need to. You can’t change rules looking retrospectively. Again, that is something that needs to change.

Outlook on South Africa:

I still think that we can make a lot of money by operating in South Africa. But it’s tough and it’s not conducive to building up a shareholder base and a share premium, in terms of your equity. So, it is a tough place to operate but there’s a need for some really tough decisions and corruption to be dealt with properly. What we are seeing is tokenism. To some extent, as business, we are being humoured. It’s time for business to start taking a very transactional approach.

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