Nov 18, 2011
Cancun|Copenhagen|DURBAN|Kyoto|Rustenburg|Codelco|Engineering News|Mining Weekly|Platmin|Chile|South Africa|United Kingdom|COP|Energy|Life Insurance|Media Conference|Mining|Northern Cape|Hazel Jenkins|Martin Creamer|Engineering News|Formula One|The World Cup|World Cup
© Reuse this
Gwala: The gun that Chile is holding at the head of Anglo American is putting South African investors at risk.
Creamer: The sort of money involved is what we paid for our World Cup hosting. What they want free, gratis and for nothing, from the shareholders of Anglo American and there are a lot of South African shareholders as well, because we have the roots of this company going back to 1917, is as much as we paid to host the World Cup here, more then R30-billion.
So it is not a small amount, but the point that Chile is missing in trying to force Anglo to sell half of their assets to State-owned company Codelco, is that it is the small people that are now the investors in these big companies. This is what has happened in the world.
You have got pension fund capitalism. Just recently we had a situation where Platmin, a platinum company in Rustenburg, was borrowing money from a Dutch pension fund and during the media conference the Dutch ambassador stood up and said that it is also his pension fund and his money goes into that and that Platmin better do a good job. I think that is what Chile is forgetting. They are looking very narrowly at these copper assets, which they feel they have a right to get their hands on.
They want 49%, but they want to pay a pittance for this. The people who will suffer will be the ordinary working men and woman, whose pension funds, provident funds and contributions to life insurance goes into these investments. This is how the modern world works. This is the economic underpin of the modern world, by far the biggest amount of funds come from the ordinary people. Now there is a major legal battle about to happen between Anglo American and Codelco.
Codelco stopping them from selling anymore of their shares, because they quickly defended themselves by selling nearly a quarter of their shares at what was a price that showed up the value of the company and showed up how much the Codelco State-owned Chilean Enterprise was wanting to take off the table free, gratis and for nothing.
Gwala: I wonder though the impact this will have on the Chilean investments as far as mining is concerned, because this week Karel Smit head of energy and natural resources at KPMG told us that in the last ten years South African mining has declined as a contribution to gross domestic product and the sector has seen 0% growth in the last 80 year and 14% for a country like Chile.
Creamer: It just shows you that Chile has been held up as a paragon of investment virtue. Now they are showing a silly side that I think will impact on their reputation as an investment destination.
We are more transparent in South Africa, we have this open debate on nationalisation and it comes back to haunt us because we also have less investment and obviously we also have other infrastructural constraints that have led to the fact that we haven’t grown. At least we debate in public, they come through with nationalisation by stealth.
Gwala: The Northern Cape has been chosen as the place to set a new world land speed record – and inspire more people to become engineers.
Creamer: Hakskeen Pan in Northern Cape has been chosen out of 34 potential sites around the world as the place where people will try to set a new world land speed record. That is being done by the Bloodhound Team from the UK. They already hold the world record at 1 227 km an hour, which they set in 1997. Now they want to go from 0 km to 1 600 km in 42 seconds.
That means every time the guy blinks he will have gone the length and a half of a rugby field. He will be powered by the equivalent of 180 Formula One racing cars and he will go faster then a bullet fired from a Magnum gun.
That is the plan for 2013 in the Northern Cape working very closely with the Northern Cape politicians and the Premier in particular Hazel Jenkins. You say to them, why do you want to do this, you already hold the record, why now do you want to go 1 600 km and set a new record.
They said the reason is that they want to draw attention to engineering. They want to get young people involved and that is why there is a whole educational segment to it. They have got 2-million students that will be involved on the internet watching their progress.
They say the world over, not just the UK and South Africa, but the world over people are short of engineers, mathematicians and scientists. They want to use this land speed record attempt to make sure that people enter these fields of engineering, mathematics and science. They want to peak their interest and inspire them.
Gwala: Talking about science, there will be a lot of science talk happening at the COP 17 climate conference in Durban as world leaders prepare to come to Durban, there are few signs of global consensus on climate change.
Creamer: Well in actual fact there are very few signs of global consensus. We are coming into a situation where 14-years ago they had the Kyoto and it has got to be renewed next year.
A lot of people who even signed it 14-years ago are saying that they are not going to sign again. There is a danger that the whole move towards combating climate change is not going to have a world consensus.
This is the big worry at the moment is that the world is not coming in behind and it looks already like a lot of voices that are dissident and saying that the emerging countries have fewer obligations, but they are beginning to admit more. In the background, of course, is this whole Eurozone debt crisis.
The COP 17 in Durban, there is a danger that it will be drowned out by the Eurozone debt crisis. In the meantime in South Africa we are looking at this quite seriously and you’ll see that we’ve just had this big green accord.
That is looking at all our stakeholders and trying to say that out of this green initiative let’s go for it as world body. It is no good just having countries engaging in bilaterals, that is a bizarre type of thing.
There is a lot of economic potential in this. They are talking about 300 000 jobs. We have until October 13 to finalise our carbon budgets and there is a concern around this carbon tax. South Africa is seeing the positives in this more than many other countries.
Hopefully, because we are the host as well, we might be able to say that Durban was a success, where you’ve had failure in Copenhagen with COP 15 and COP 16 in Cancun. There hasn’t been such a good response, perhaps it will happen at COP 17 in Durban.
Gwala: It will be nice if anything happen. But the signs, as you say, is that there is not much going to happen.
Gwala: Thanks very much. Martin Creamer is publishing editor of Engineering News and Mining Weekly, he’ll be back with us at the same time next week.
Edited by: Creamer Media Reporter© Reuse this Comment Guidelines
Recent Research Reports
Steel 2014: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2014 report provides an overview of the global steel industry and particularly of South Africa’s steel sector over the past year, including details of production and consumption, as well as the country's primary carbon steel and stainless...
Projects in Progress 2014 - First Edition (PDF Report)
This publication contains insight into progress at the delayed Medupi and Kusile coal-fired projects, in Mpumalanga and Limpopo respectively, as well as at the Ingula pumped-storage scheme, which is under construction on the border between the Free State and...
Automotive 2014: A review of South Africa's automotive sector (PDF Report)
The report provides insight into the business environment, the key participants in the sector, local construction demand, geographic diversification, competition within the sector, corporate activity, skills, safety, environmental considerations and the challenges...
Construction 2014: A review of South Africa's construction sector (PDF Report)
Construction data released during 2013 hints at a halt to the decline in the industry during the last few years, with some commentators averring that the industry could be poised for recovery. However, others have urged caution, noting that the prospects for a...
Electricity 2014: A Review of South Africa's Electricity Sector (PDF Report)
This report provides an overview of the state of electricity generation and transmission in South Africa and examines electricity planning, investment in generation capacity, electricity tariffs, the role of independent power producers and demand-focused initiatives,...
Defence 2013: A review of South Africa's defence industry (PDF Report)
Creamer Media’s 2013 Defence Report examines South Africa’s defence industry, with particular focus on the key players in the sector, the innovations that have come out of the defence sector, local and export demand, South Africa’s controversial...
This Week's Magazine
The Electronic Systems Laboratory (ESL) of the Department of Electrical and Electronic Engineering at Stellenbosch University is strongly reaffirming its position as one of South Africa’s leading centres for satellite technology and expertise. It is currently...
The world’s lowest-cost diesel-electric locomotive is not made in China, but in Pretoria, at RRL Grindrod Locomotives’ newly upgraded 30 000 m2 plant. The company’s locomotive pricing is “more competitive than any other original-equipment manufacturer (OEM)...
The South African Defence Review 2012, released to the public at the end of last month (despite the year given in its title) recommends the creation of the post of Chief Defence Scientist. This official would be responsible for the management of defence technology...
AltX-listed engineering technology company Ansys has been awarded an R188-million contract by Transnet to supply integrated dashboard display systems to the freight rail utility’s locomotives. Black-owned and controlled Ansys developed the bespoke integrated system...
South Africa’s sole nuclear power station Koeberg, which is located in the Western Cape, breached a major operations milestone on April 4, which marked the thirtieth anniversary of Unit 1 having been connected to the grid. Eskom, which operates the two-unit plant,...