MINING: South Africa's Attractiveness for Mining Plummets
Recent Gauteng Business News
2006, according to the latest South Africa Survey, published by the South
African Institute of Race Relations in Johannesburg.
In 2006 South Africa was ranked 37th out of 64 countries and territories.
The country's position has declined since then and its 2010 ranking was 67th
in an expanded survey of 79 countries and territories, The data was sourced
from the Fraser Institute.
Reasons for South Africas Low Mining Ranking
South Africa's relatively low ranking is a result of perceived policy
uncertainty in the eyes of potential investors. Factors such as uncertainty
concerning the administration, interpretation, and enforcement of existing
regulations are identified as one of the main deterrents to investment.
Concerns over labour regulations, employment agreements, and work
disruptions, the reliability of the legal system, and uncertainty over
disputed land claims are also considered strong deterrents for mining
investment in South Africa.
According to the data, factors influencing mining investment in South
Africa's favour are the availability of labour and skills, the quality of
the country's infrastructure, the quality of its geological database, and
the State's environmental regulations.
Uncertainty a Huge Concern for South Africa Mining
The mining sector in South Africa contributes 9.6% to GDP and employs 3.1%
of the country's labour force. In 2010 the sector contributed 15.3% of
country's exports. 'Uncertainty over nationalisation and mine ownership, and
increasing work disruptions are affecting investors' willingness to get
involved in mining ventures in South Africa', said Mr Jonathan Snyman, an
Institute researcher. 'Investors are looking for a stable regulatory and
policy environment, but the conflicting sentiments surrounding the
nationalisation debate are not helping to allay their concerns.'
In November 2011 the president of the National Union of Mineworkers (NUM),
Mr Senzeni Zokwana, acknowledged that policy uncertainty was hurting
investment in Mining South Africa.
Business News Sector Tags: Mining|