'Mining industry needs regulatory certainty'

Industry moguls have
named regulatory
uncertainty as one of the
key obstacles in the South
African mining sector
which is already under
pressure in light of low
commodity prices.
With the controversial
Mineral and Petroleum
Resources Development
(MPRD) Amendment bill
yet to be finalised, industry
role-players both local and
abroad remain hesitant
about the South African
industry in particular.
The bill, if implemented
in its current format, will
have a major impact on
mining in the country
thanks to numerous
amendments. While it has
passed through parliament
it has been on the desk of
the president for months
awaiting promulgation.
Foreign investors in
particular have said if
enforced the new bill
will make it difficult to
determine the rules of the
game and many believe the
legislation will dampen
investment in the mining
sector.
From an operational
point of view the regulatory
changes proposed also
create major uncertainty.
According to Minister
of Mineral Resources,
Mosebenzi Zwane, the issue
of regulatory uncertainty
is one that is understood
by the government and all
efforts are being made to
speed up the process around
the new legislation.
“During my first
four months in office, I
have taken the time to
understand the views
of the industry. During
my engagements with
stakeholders over the past
few months, they have
shared their views with me
and we have had robust
discussions,” he said.
“Industry has indicated
to me that regulatory
certainty is necessary. I
appreciate the importance
of regulatory and policy
certainty. I assure you
that the government has
prioritised the processing
and finalisation of the
MPRD Amendment Bill as
a matter of urgency in order
to entrench the necessary
certainty.”
He said government
was also in the process
of reviewing the Mining
Charter which was an
important transformation
tool for the sector.
This was the central
message Zwane delivered
to the Mining Indaba, but
industry remains sceptical.
Andrew Lane, Africa
mining leader for Deloitte,
said industry wanted
to hear a more tangible
action plan for addressing
key issues in the mining
sector.
“What actually creates
certainty is cohesiveness in
government’s statements,”
he said.
In this regard, while
it is commendable that
government is planning to
revise the Mining Charter,
there is still no indication
of how the Charter and the
Department of Trade and
Industry (dti) scorecard will
be aligned.
“Right now, a company
may comply with all the
provisions of the Charter,”
explained Lane, “but still
fall short in terms of the
dti scorecard, and that is a
concern.”
According to Jacques
Barradas, a partner
specialising in the mining
sector at Grant Thornton
Johannesburg, it is essential
that government updates
and finalises the MPRD
amendment bill sooner
rather than later.
“It will bring South Africa
on par with other emerging
economies,” he said.
INSERT & CAPTION
The issue of
regulatory
uncertainty is one
that is understood
by the government.
– Mosebenzi Zwane
Photo: Mining Indaba 2016