21/07/2017 03:57 SAST | Updated 21/07/2017 03:57 SAST

We Should Stop Paying Attention To The Chamber of Mines -- And Here's Why

The Chamber has often paid lip-service to the desire to transform the economy. But one only has to look at their record.

Mosebenzi Zwane, South African Minister of Mineral Resources, addresses the first day of the Mining Indaba 2016 Conference on February 8, 2016, at the Cape Town International Convention Centre in Cape Town.

On the 15th of June, 2017, Mineral Resources Minister, Mosebenzi Zwane gazzetted a new charter for the mining sector, to much fanfare from workers and mining sector unions, and cries of hail-mary from the mining industry lobby, the Chamber of Mines. While the unions praised the charter for dealing seriously with the question of transformation - an area in which the mining industry notoriously continues to lag behind, the chamber of mines argued that the charter went against the prescriptions of the Mineral and Petroleum Resources Development Act (MPRDA), and that it was drafted without consultation with the industry.

Fast-forward to the 14th of July, implementation of the Charter is suspended, after the government and the Chamber of Mines reach an agreement. Pursuant to their agreement, the Chamber is to sue the government within 48hours if any part of the charter is implemented prior to the courts weighing in on an interdict sought against the charter by the Chamber. A ruling on the interdict is expected in September. Predictably, the mining sector unions are "shocked and disappointed" by what they see as the minister's cowering to the industry.

Today, Thursday 20th July 2017, Minister Zwane has issued a new regulation effectively freezing all mining transactions in South Africa, a move which the Chamber of mines has argued would not stand up to legal scrutiny and is an attempt to implement the charter from the back-door. So far, the ANCWL has expressed support for the minister's move, blasting the Chamber for what the league sees as the Chamber's efforts to protect "white monopoly capital."

In the midst of this weeks-long twist and turn, the Rand has plummeted and then rallied against the US Dollar. But something else has remained rather constant, the Chamber of Mines has continued to seek ONLY the profits of their mining industry sponsors, paying no mind, therefore, to what most people agree should be one of the mainstays of public policy in South Africa today, namely, changing the ownership patterns of South Africa's economy. By almost all metrics, South Africa's economy remains firmly in white hands. In all that has transpired around Minister Zwane's actions, it has been unmistakably clear that the mining industry would rather have things continue exactly as they are.

Admittedly, it might seem that I am being dubious in claiming that the Chamber of Mines wants things to remain exactly as they are, especially since the Chamber has often paid lip-service to the desire to transform the economy. But one only has to look at their record. The industry had 10 years under the mining charter that expired in 2014, to transform. According to former Minister of Mineral Resources, Ngoako Ramatlhodi's 10-year review, the mining sector had failed on nearly all the transformation goals set by that charter. Expectedly, they contested that review and produced one of their own. Organisations such as the nonprofit Benchmark Foundation have found that even by their own methodologies, the mining sector still fell well short of transformation targets.

At what point are we going to realise that to move South Africa in the direction of much-needed transformation, we will have to shake the stranglehold which industry lobby groups, such as the Chamber of Mines, have over policy-making? Giving the Chamber of Mines the privileged position they currently enjoy is the single greatest threat, bar the malignant corruption within the ANC, to the transformation of the mining sector. They are fine with things as they currently are.

The government wants to transform the economy or they want to continue asking input from people who have an interest in the economy remaining exactly as it is.

To be sure, many will argue that the interests of the mining industry are not as antithetical to the interests of the ordinary South African as I am suggesting. They might argue that if the mining industry does well, the SA economy is helped in the form of employment and exports. In my view, this contention is quite naïve. The interest of the mining industry is essentially to maximise profit for their investors. To suggest otherwise is the height of naïveté.

No one, not least in the industry itself, actually believes that (1) if investors can make more money investing elsewhere, that they will remain loyal to South Africa and South Africans (Why? Because they love SA so much?) and, (2) if cutting South African jobs and turning to automation, as cost-cutting measures, will serve their profit-maximizing interests, that they wouldn't do exactly that. We ought to have no reasonable expectation that these industries will take the interests of ordinary people into consideration. At no point in South African history have they ever done so.

But also notice that what is typically excluded in the above contention, is a serious pathway to transformation in terms of ownership. Just providing jobs is well and good, but that is only part of the story. What are the measures the industry is independently taking to transform ownership patterns in the sector of their own accord? No one, even the industry's greatest cheerleaders, is able to coherently articulate such measures. At least I have not seen any.

As I see it, at this point, it's either the government wants to transform the economy or they want to continue asking input from people who have an interest in the economy remaining exactly as it is. As it stands, the ANC is full of people who believe that if only they say it often enough it just might become true that industry lobby groups, such as the Chamber of Mines, will help us transform. They will not. It is not in their immediate profit-maximising interest to do that, and the Chamber of Mines does not do anything that is not in their immediate profit-maximising interest.