The depressed global economic environment has created challenges in the mining sector, and, although some commodities are beginning to emerge from the slump, conditions remain difficult for the sector, Department of Mineral Resources (DMR) deputy director-general Joel Raphela told delegates at the 2016 Youth in Mining, Procurement and Transformation Summit, in Johannesburg, last month.

“We have seen how this has led to some mining companies exiting the space. We believe that this is an opportunity for new mining giants to be created, and some of those may come from among the young people of our country,” he said.

Raphela pointed out that the Mining Charter had been in effect for the past 12 years, which had helped to transform the local mining sector, as more black people had been able to participate as mine owners and managers.

Nonetheless, he stressed government believed that there was still “some way to go” before it could declare that the sector had been “radically transformed”.

Therefore, Raphela highlighted that it was for this reason that the DMR had proposed in the draft Mining Charter that a mining right-holder should procure a minimum of 60% of locally procured manufactured capital goods from black economic-empowerment-compliant manufacturing companies.

He said the draft Mining Charter also required right-holders to procure 70% of their manufactured consumables locally and secure 80% of a mine’s services from local service providers.

“We have also revised the contribution by multinational suppliers of capital goods to a minimum of 1% of their annual income to a social development fund. This element further introduces a contribution towards supplier development and enterprise development,” Raphela explained.

He further urged delegates to submit proposals to the DMR about ways to ensure improved transformation of the industry.
Raphela explained that the department did not only want people to raise concerns about the need for change in the mining sector, but also for people to provide possible solutions as to how the goal of “meaningfully transforming” the sector should be achieved.