Government and business agreed in principle on Friday that the current legal approach to finding resolution to the issue of black economic-empowerment ownership of mines should be halted in favour of a consultative process to be held under the aegis of the Operation Phakisa Mining Lab. Cabinet announced recently that the mining lab would convene over a four-week period during October.
In March, government, organised mining and labour agreed to work collaboratively to obtain a court ruling to clarify the ‘once empowered, always empowered’ principle.
However, there had since been misgivings within government and the mining industry with the approach, with Anglo American CEO Mark Cutifani indicating recently the group’s preference for an out-of-court resolution to the matter.
Speaking in Johannesburg during a recent visit to South Africa, Cutifani indicated that, while Anglo had supported the Chamber of Mines’ role as an applicant to the courts, he felt pursuing direct talks with government on the matter was a better course of action.
Such a conversation would, he hoped, make the declaratory order currently being sought “redundant”. “Don’t let the courts, or a single judge, decide the future of this country; that’s not their role,” he said.
Addressing the media following a Presidential Business Working Group, which took place at the Sefako Makgatho Presidential Guest House, in Pretoria, Trade and Industry Minister Dr Rob Davies said it had been agreed that litigation should be halted in a bid to seek resolution through the Operation Phakisa Mining Lab.
“One of the very important outcomes of the meeting, which I think reflects the spirit of us working together, was an agreement that the issues of litigation around the Mining Charter should be taken back to the full membership of the Chamber of Mines to see whether they would endorse a proposal to halt litigation until the end of the Operation Phakisa process,” Davies explained.
Separately, the meeting also agreed to support protection for South Africa’s primary steel industry, which had made application for duties on some steel products to be increased to the bound rate of 10% allowed for under South Africa’s World Trade Organisation commitments.
However, Davies stressed that downstream steel consumers had also insisted that such protection should not form the basis for increased domestic steel prices, but rather create the space for the local industry to win back market share from imports.
ArcelorMittal South Africa, which has made several tariff applications through the International Trade Administration Commission of South Africa, had argued vociferously for such protection on the basis that it was unable to compete with cheap, “subsidised” steel imports from China.
It estimated that imports supplied up to 30% of consumption during the first half of 2015.