Business Maverick


Minerals department statement that killing executives ‘taints image of mining in SA’ won’t calm investor jitters

Minister of Mineral Resources and Energy Gwede Mantashe. (Photo: Flickr / GCIS)

Minerals and Energy Minister Gwede Mantashe visited Richard Bay Minerals last Thursday after the murder of its general manager Nico Swart. Mantashe gave assurances to the investment community that ‘it was safe to invest in South Africa’ while acknowledging that Mafia-style hits against executives were not a selling point.

Richards Bay Minerals (RBM) mostly produces titanium dioxide slag, used in the production of a range of industrial items from paint to toothpaste, and is a unit of Rio Tinto, which is one of the world’s biggest mining companies. A planned $460-million expansion to RBM, launched to much fanfare in 2019 – when President Cyril Ramaphosa’s “investment drive” appeared to be gaining some traction – came to a juddering halt because of community violence. Since 2015, three employees of RBM have been murdered, with Nico Swart’s slaying in a hail of bullets the latest.  

So Mantashe, who has faced allegations of tone-deafness when it comes to investor jitters, was jolted into a display of concern. The press release that was the result is a classic example of stating the obvious – or understating? – on one hand while blithely ignoring wider issues. 

“Since 2015, three employees of the mine have been killed. The minister cautioned against the killings of mining executives across the country. Such killings taint the image of mining in South Africa,” the Department of Mineral Resources and Energy (DMRE) statement said.

“Cautioning” against killings is not exactly fighting words – where is the late Steve Tshwete when you need him? – and saying such killings “taint the image of mining in South Africa” will surely be in the running for the most obvious statement of 2021.

The minister, who cut his teeth in the labour movement but recently earned an MBA, may also be showing some class bias here. Perhaps those MBA assignments gave him a boardroom view of the world – exchanging a blue-collar for one that is white. Because it is probably worth mentioning in passing that shooting dead 34 striking mineworkers in 2012 at Marikana also “tainted” the image of mining in South Africa. It certainly didn’t do Lonmin any good – there is a reason that company is now extinct.   

The statement also said: “The minister was joined by members of the KwaZulu-Natal provincial executive led by Premier Sihle Zikalala, the chairperson of the Parliamentary Portfolio Committee on Mineral Resources and Energy, Mr Z Luzipho, the KwaZulu-Natal provincial police commissioner, and senior officials of the DMRE, the SAPS and KZN provincial government.”

So an entire posse came out to show that the government really – seriously! – gives a toss. Of course, much of the problem in the first place lies with such government officials and departments. For example, effective policing would surely help on the murder front. 

The statement also contained this kicker: 

“If there is a view out there that it is dangerous to invest in South Africa, we will not see investment. There may be problems, however, if we work together, we can resolve our problems. South Africa is open for investment, and we reassure the investor community that it is safe to invest in South Africa,” concluded Mantashe.

Safety and concerns about violence, murder and mayhem – and wider social unrest – certainly are deterrents to investment. But much of this is rooted in ANC politics and the wooing of traditional leaders and other constituencies who have come to expect their share of the spoils, and stir things up when the cheque appears to be lost in the mail. 

And as this publication has pointed out numerous times, the dysfunction and lack of transparency at the DMRE is also off-putting to investors, to say the least.  

Then there is the small issue of unreliable power supplies and the DMRE’s refusal to allow mining companies to build power plants that can generate up to 50 megawatts, while giving a highly questionable contract for 20 years to a Turkish power company that will deploy powerships that emit carbon. 

So yes, murdering executives – not to mention rank and file mineworkers who hold rock drills for a living – is not a big selling point that will woo pension fund managers in New York and places like that. But a backlog of over 5,000 applications for mining and prospecting rights, which speaks volumes about DMRE incompetence and gives rise to suspicions of corruption, is also not going to entice them to deploy capital in the South African mining sector. A proper mining cadastre, among other things, is long overdue. And yes, bringing murderers to account will also help. DM/BM


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All Comments 9

  • Don’t forget that investors must hand over 26% of any deal to the previously disadvantaged. Therbye killing any potential investment . Plus the draft geomatics bill seeks to expropriate all exploration info and sell it on….Oh and some of the executives must be brown or preferably black. Skin colour matters to these small-minded folks. As long as this Mafia is in charge it just encourages the wrong kind of competition.

    • Correction. 26% is handed over to a designated black owned business making the directors instant millionaires. Squat goes the PD sectors of society. Plus the local amakhosi picks up a couple of million pa in lease fees none of which he shares with his minions. Plus I heard a story that when RIO Tinto directors were asked where their social responsibility donation of 300 million pa went they gave the bank details of the local Amakhosi who couldn’t account for one cent and couldn’t demonstrate one project that benefitted his people

  • Aren’t we all tired of repeating the same things over and over again.
    No matter which side of the political spectrum you sit on, in all cases transformation is not happening fast enough. Gwede Mantashe and the DMRE are a classic example of a lack of any imagination or courage to move forward without being captive to the manipulation of the unions.

    • The thing about transformation that deserves proper study is why it seems to fail mainly in state and related.

      I am today coming out of ten days hospital. Yes private, but certainly fully transformed and everything was great. No different nearly all the staff at several suppliers I deal with are virtually not white. I can admit that the nonwhite and white staff at retail banks and cel phone companies are equally dismal. Can go through my entire supply chain and the ONLY places where transformation are dismal failures are state, local government, SOE and the various authorities.

      Why is that??? Leadership, policy, inability to train and develop, NAFI???

  • Spot on. And of course there is the stubbornness to uphold the coal industry forever and a day, whilst again trying to pry open SA’ doors to fracking. This will surely attract investors – but the wrong kind whose aim it is to destroy the earth in exchange for short term financial gains. So inspiring for a better future for all.

  • That MBA that by his own trumpet-blowing took such courage doesn’t seem to have translated into courage to do what it takes to attract the necessary investment in the sector.
    “Please invest in SA! You might lose a few executives and many billions to our rampant organized criminal activity wrapped up with endemic corruption and political violence, along with a minor electricity supply problem. But hey, those are normal costs of business and I need to stay in my constituency’s good books so I can’t fix these things”

  • Gwede probably meant MBD- Master of Business Demolition. If he got a Masters based on the running of his Energy and Mining Portfolio then there is something seriously wrong in academia SA at present.