Photo by: Bloomberg
JOHANNESBURG (miningweekly.com) – South Africa should avoid shunning any potential mining investments emerging from countries outside the Brics economic bloc, which included Brazil, Russia, India and China.
This was the message that emerged from a panel at the Joburg Indaba: Investing in Resources and Mining in Africa, held in Inanda, on Thursday.
While South Africa was secure in its position within the Brics economic bloc, it remained a member of the “fragile five” and needed to compete effectively for a diverse range of capital to bolster its lagging mining industry.
Morgan Stanley last year coined the term “fragile five” to describe the emerging markets most at risk of economic turmoil. These comprised Turkey, Indonesia, South Africa, India and Brazil.
“We need the world,” Kaouat Iron CEO and TransAfrika Resources executive director Gerard Kemp told delegates, adding that South Africa needed “a lot” of capital to evolve its mining sector.
“Two hundred countries are screaming for capital,” Cadiz Corporate Solutions mining specialist Peter Major explained.
The nation could not rely on investment from just one, or a few, other nations, as this left South Africa open to being “held hostage” by those investors.
RMB Global Markets Research Africa analyst Nema Ramkhelawan-Bhana pointed out that the country should balance the countries with which it affiliated to afford access to a broader spectrum of investor countries able to inject capital into South Africa’s capital-hungry mining sector.
“We [also] need to be cognizant [of the fact] that we are in competition with everyone. We need predictable and stable policies and it helps no one if we continue to focus on negative narratives,” added Public Investment Corporation resources head Sholto Dolamo.