President Cyril Ramaphosa said the government is working with various sectors to address challenges facing the mining industry.
Ramaphosa was delivering a keynote address at the 30th Investing in African Mining Indaba held in Cape Town on Monday.
The President said the mining sector contributes about 7.5% towards GDP and accounts for some 60% of the country’s exports by value.
He said the mining sector is facing strong headwinds, and several persistent challenges are impeding mining performance.
Globally, Ramaphosa cited commodity price volatility, high energy prices, geopolitical tensions, and other factors.
Locally the President highlighted load shedding and illegal mining as some of the challenges.
“Domestically, the energy crisis and port and rail bottlenecks are putting serious pressure on miners’ operational costs.
Illicit mining, cable theft and infrastructure vandalism place a further strain on mining output and returns.
We are committed to work hard and work together to overcome these serious challenges,” said Ramaphosa.
He told the Indaba that government last year outlined four objectives to develop the sector, improve its global competitiveness and harness the global drive towards sustainable development.
The President said key among these objectives is to achieve a secure supply of electricity.
“Through the Electricity Action Plan, government has taken several critical measures to improve the performance of our existing generation fleet and to add new electricity capacity.
The Department of Mineral Resources and Energy has secured 1 384 MW of new generation capacity that is currently in construction or already in operation.
The Department has released requests for proposals for the procurement of 5 000 MW of renewable energy under Bid Window 7,2 000 MW of gas-to-power and 615 MW of battery storage,” explained Ramaphosa.
The president said other objectives identified is the acceleration of economic reforms to improve the operating environment, tackling illegal mining and damage to infrastructure.
According to Ramaphosa, there has been several arrests, prosecutions, and convictions of the perpetrators of illicit mining, and the sealing of old mines.
Since 2019, the department has closed and sealed 251 derelict holes, shaft and in the next three years, the department of Mineral Resources and Energy intends to close a further 352 shafts.
Ramaphosa said in the last three decades, the mining industry has undergone significant transformation, when compared to the apartheid period.
“For nearly 150 years, mining has been a pillar of the South African economy.
Working with industry and labour, the democratic government has been able to effect wide-ranging and sustainable transformation of the sector over the past three decades.
In 2004, the year the Mining Charter was first introduced, black ownership in the industry stood at some 2%.
Today these stands at approximately 39%,” added Ramaphosa.
He highlighted that the sector currently employs approximately 476 000 people, mineworkers can organise, and their rights are protected.
Ramaphosa said during apartheid, the mining sector was notorious for labour exploitation, human rights violations, and poor health and safety standards.
The Indaba is expected to continue until Thursday.
