Minerals Minister Ngoako Ramatlhodi
Photo by: Duane Daws
JOHANNESBURG (miningweekly.com) – Talk of restoring the lost iconic status of the South African mining industry has gladdened the London-based Investec Global Research Team.
“We’re glad to see growing political pressure in South Africa to restore the premier status of the mining industry,” the analyst team said in a note on Friday.
Quoting the Financial Times of London, Investec reported that new South African Mining Minister Ngoako Ramatlhodi was pressing for a “national mining champion” to emerge from the corporate restructurings of mining majors currently under way.
The Minister was speaking in London to drum up support for the International Geological Congress to be held in South Africa in August next year.
His comment echoes what African National Congress (ANC) secretary-general Gwede Mantashe told last year’s Joburg Indaba, when he called for the creation of a South African mining company of substance within the country’s borders - and is also a reverberation of what the ANC head stated in specially written guest column for Mining Weekly.
Mantashe told the Joburg Indaba that the creation of a local mining champion would ensure that national interests were taken to heart.
"When we change our narrative to a positive one, we will be able to change the way in which the country's mining sector is viewed, which will, in turn, positively affect investment and the way our country is viewed on an international level," he told delegates to the event.
Ramatlhodi was quoted as making it clear in his latest London statements that he was not proposing a State-backed group, although he said existing State-owned mining concerns should also grow.
“I want a champion that is privately owned, run by South Africans and is a successful enterprise,” the Minister reportedly said.
Mining Weekly Online can reveal that Mantashe has for long contended that South Africa’s Johannesburg Stock Exchange has been negatively impacted by South African mining giants like Anglo American and Gencor/Billiton being allowed to migrate to global stock exchanges.
In the guest column for Mining Weekly, Mantashe condemned as “suspicious and disingenuous” what he described as the trend of South African companies using South African capital to grow assets outside of the country and then, once their foreign holdings had matured, to ring-fence the South African assets out of their portfolios.
Mantashe had been requested to write the guest column for Mining Weekly after he had lashed out during a national radio debate, saying that Anglo American had “stolen our money” in listing in London and become “a British company”.
He outlined in the article how Anglo American Corporation had been formed in South Africa in 1917, with the initial capital of 50% contributed by Sir Ernest Oppenheimer and his family, and the remaining 50% contributed by two American companies, JP Morgan and Company and Newmont Mining Corporation.
The US contribution resulted in the word “American” featuring in the name of the company, which, in the main, derived its fortune from mining South African gold and diamonds, and later diversified into related sectors like explosives and other manufacture.
He recalled how, by the 1980s, the Anglo American web had covered virtually every sector of the South African economy on the back of South African mineral deposits and cheap South African labour.
He singled out Nestle for special praise for remaining a proud Swiss company even during a period when it was only generating 2% of its revenue from Switzerland and used the proudly Australian BHP as another example, recalling that when South Africa’s Gencor reconstituted itself into the London-listed Billiton, it had been forced to move its primary listing to Australia on merging with BHP.