Sunday, July 31, 2011

Mining Tycoons Back Malema

23rd September 2010

Mining giants Bridgette Radebe and Minister Tokyo Sexwale have thrown their weight behind the nationalisation of the country’s mineral resources, saying the time has come for the state to reclaim its rightful share.

In a closed-door session on economic transformation at the ANC’s national general council yesterday, the two heavyweights argued that the days of monopoly ownership of the country’s mines had come to an end.

“It doesn’t matter how we skin this cat, but we have to skin it,” Radebe, who is president of the South African Mining Development Association, told The Mercury.

“The problem is the capitalists’ mining model, which says: take a piece of land, explore, exploit, extract, export, leave ghost towns and go overseas,” said the woman who has been in mining operations for the past 23 years. She is billionaire Patrice Motsepe’s sister and wife of Justice Minister Jeff Radebe.

“When we created a new South Africa, 83% of the resources were owned by the minority. Now 91% is owned by the monopolies. And I ask myself, as a committed economic activist, is this the South Africa we fought for? We are sliding backwards. Some fundamental decisions have to be made.”

What she proposed to the ANC mid-term meeting yesterday was a multi-faceted approach to claw back ownership.

“We can have a public-private partnership,” like Botswana has entered into with De Beers and in which both parties have a 50:50 share under the banner Debswana, fuelling “70% of the country’s gross domestic product”.

“We can have 100% state ownership,” she added, while her third proposal would see ailing BEE firms, “who have become more of a burden to the mining companies” sell their shares to government.

“I don’t like using the word nationalisation because people don’t listen,” she said. “I’m saying let’s state-own, control and manage.”

She points to the example of the United States where President Barack Obama recently provided a financial cushion for the banks.

“He bought out those banks. What was that? Nationalisation? He calls it a bail-out,” she said.

Human Settlements Minister Sexwale also pushed for nationalisation, but through a state-owned mining company.

While he endorsed this form of nationalisation, he urged the ruling party to proceed with “caution” as history was littered with examples of nationalisation gone awry.

He also appealed for a “balanced approach” which was both practical and realistic to avoid South Africa proceeding down a path that would be detrimental for the country’s economy. The minister also called for a detailed study that would outline the full extent of possible future state ownership.

Radebe told yesterday’s meeting: “Begin with me. I have mines. You can take them. I’m not looking for money.” However, she was quick to add that her offer was not to be interpreted as a precedent for mine grabs.

“What I am saying is I am willing. That’s all. We don’t want expropriation. We want a situation that works for everyone and this works for me.”

The endorsement for what is potentially a costly move comes at a time when the ANC-led government is already sinking under the weight of added costs to the public purse, with an enlarged cabinet under President Jacob Zuma, a recession that has cut jobs and income tax revenue accordingly, while calls earlier this week for a multibillion-rand public health system will only add to the financial burden.

However, Radebe insists the money required to buy into or buy out mines can be found through mining royalties. She was also confident that the country had the expertise that was required to efficiently run hi-tech underground operations, saying that like the big mining houses do, the South African government could contract out management of the mines to experienced firms.

Their support for nationalisation comes at a time when ANC Youth League president Julius Malema is sorely in need of a political dig-out.

Yet Radebe was quick to point out that this was not about personalities.

“It’s not about Julius and it’s not about Bridgette. It’s about what is going to make a fundamental change to the country,” she said.

However, not everyone was as warm to the idea as Radebe, Sexwale or the majority of delegates who The Mercury understands roundly backed a move to nationalise.

Minister Trevor Manuel, who was the rapporteur of the session, had his knuckles wrapped by ANCYL members when they argued he wasn’t interpreting the message from the floor correctly. But his office downplayed the incident, saying there were noises from “certain individuals” but it was no more than that.

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