Two articles caught my eye on the mining charter.
Tim Cohen wrote a piece yesterday on the mining charter and how the industry has descended into a corrupt mine field.
In the new South African mining strategy , the industry managed to include the notion of “sustainable growth” along with the requirement of “meaningful transformation”, which has been arguably the only thing the department has really cared about until now. The department has often painted itself as the sole and crusading believer in transformation, which is just nonsense. Mining companies in general are not so stupid they don’t realise the need to compromise . What has changed is the realisation that all the discretionary items that have been put into the new legislative and rights formulations have resulted in creeping and debilitating corruption.
The department typically turned a blind eye , thinking perhaps it was an unfortunate side-effect of transformation . But it was actually eroding the industry, as investment levels show.
Cohen notes
In Australia, investment is considered so important that a popular prime minister falls within a month of threatening that investment climate. All mining companies had to do to reverse a decision to impose a super mining tax was to threaten to pull their expansion projects.
Not quite the same with our government - as Hilary Joffe concluded in her article today.
Shabangu’s comments (any company that sold its empowerment stake to non-empowered shareholders would just have to do another deal) were a depressing reflection of how little appetite there is in the government for a rethink. Policies often do prove to have unintended, even damaging, consequences. But it takes bold leaders to admit that, and even bolder ones to throw out the articles of faith and start again.
Quentin Wray's blog actually calls for a lot more government accountability but does not absolve the private sector's involvement in the transformation process
It is easy for the government and the ANC to blame (transformation) failings entirely on the business sector rather than critically examine its own role in the failure of its policies. However, it is also all too easy for business to put all the blame on to the government. Both sides are wrong.
What we need is a new approach to the whole thing. Government must start delivering what it has promised rather than blaming others for its failures and business must embrace the notion of doing the right things because they are right rather than just required. Unless this happens, at some stage, there will be no more give from either side and the simmering antagonism between the business community and the government will evolve into something far more sinister.
Both sides have massive extortion power - the private sector can withhold investment and cut jobs and the state can capriciously pull licences - and it would be a tragedy for all of us should the relationship to degenerate into a tit-for-tat, my stick is bigger than yours battle.
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