The release of the Mining Charter today is proof that the ANC government does not care about long-term and sustainable transformation in the mining sector. Version 3 of the Mining Charter will be a disaster for the mining industry.
In presenting his new rules, which amount to a massive giveaway of mine value to the ANC's favoured groups, Minister Zwane has opened the doors to more ANC crony enrichment.
The DA supports share schemes for miners when they are structured to benefit the workers and are economically viable. One way of diversifying the mining sector would be to bring mine workers into mining schemes. It's pointless to try and diversify if it leads to the collapse of companies.
But this is not what the ANC government is proposing. Instead, the ANC government's Mining Charter proposal wants to make cronies and insiders richer, as they open up new opportunities to get in on mining deals. We have seen the devastating impact of how connected cronies, like the Guptas, prey on deals like this and how they facilitate capture of resources.
The reality is that only 8% of ownership will ever make it into the hands of mineworkers under Zwane's proposal.
Zwane's proposal also seeks to win back the favour of the National Union of Mineworkers (NUM) who are unhappy because of State Capture and a declining industry.
We believe that today's proposal's by the Minister seek to buy off communities who have been let down by the failure of ANC municipalities to deliver services, and the failure of the ANC government to create an economy that provides jobs.
We also believe that the requirement announced by Minister Zwane that all prospecting rights must be 50% +1 BEE inclusive, will mean the virtual death of prospecting. The BEE sector is perennially short of cash, particularly for speculative actions like prospecting. The amount of prospecting will plummet. Even if there are new finds, capital will be extremely difficult to raise. One wonders if Zwane actually believes his statements about this charter which he says will "catapult South Africa's economy forward." The only place the industry will be catapulted is over a cliff.
Almost 450 thousand South Africans work directly for the mines. At least as many again work in associated industries. The future of their jobs is now in doubt. Zwane and Zuma's grasping charter will be to blame.
We have no doubt that this charter will end up in court in the very near future.