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BUSINESS DAY TV: Many people want to invest in SA, Mosebenzi Zwane says
by Transcript Service,
2016-02-10 12:28:02.0
MOSEBENZI Zwane is Mineral Resources Minister.
BUSINESS DAY TV: Lower commodity prices and rising cost pressures have raised the spectre of more job losses in the mining sector. Already companies have informed the mines ministry of their intention to cut 32,000 jobs. So when talk around the sustainability of mining in SA has never been larger, SA’s Minister of Mineral Resources, Mosebenzi Zwane, joined Alishia at this year’s Investing in African Mining Indaba.
Minister, given the pressure that SA’s mining sector is facing right now both global and domestic forces, is the DMR (Department of Mineral Resources) and industry in crisis mode?
MOSEBENZI ZWANE: We’re dealing with a tough situation. We shall overcome it. We’re engaging our stakeholders and everybody and government largely, we shall overcome, we will revive this industry and we’ll move forward.
BDTV: Avoiding the extent of job losses outlined right at the top is among your top priorities right now. From your engagement with mining companies, with unions and given the harsh realities that we face right now, what is your understanding of the room industry has to manoeuvre on this?
MZ: If we are to be frank I think we have a bit of room to manoeuvre and save jobs. I am asking the industry to reinvest and prepare for the boom because the boom is coming. It will come. This, too, shall pass and people will be able to make their business there. Where there are some restructurings, we will ask new entrants to take over the mines so that people do not lose their jobs.
BDTV: Okay, so you’ve gotten much backlash for suspending all operations at Glencore’s coal mine because of the way it planned to carry out job cuts. It coincided with the news at the time that it was going into business rescue, now it’s been sold to Tegeta Exploration and Resources. It’s owned by the Guptas and it’s a sale that you helped conclude. What exactly did you bring to the table in that negotiation?
MZ: I didn’t help any deal to be concluded. I just said people must talk and try and help us to save jobs. And if they can do it speedily, to not allow their egos and so forth and I was out.
BDTV: And with that 3,000 jobs saved, yet Oakbay Resources has been in the spotlight for many transgressions within the mining sector, so what box-ticking, or criteria, is used when awarding new licences, given history?
MZ: We do not become part of the transactions and the negotiations unless theres a dire need when facing situations like this where massive job losses are going to result. So we get involved during the section 11 and that’s where we get involved. When people are ready and want to change ownership and transfer, then we get involved.
BDTV: How does this achieve BEE objectives exactly because the perception is that you’ve sold to a Gupta-controlled company and the Guptas are not South African?
MZ: Must I talk on behalf of the Guptas and say they are now citizens? I believe people should check their facts and be correct about their facts. As far as I know Tegeta’s majority shareholding is black-owned. That is a fact that you can go and check and then come back and argue if it’s not like that. That’s what I know.
BDTV: And you’ve made it clear today, 51% black shareholding within that company. You’ve been quoted as saying that one of your responsibilities is to attract investment into the country and you can’t attract investment if you don’t talk to people like the Guptas. How are you rating investor appetite in SA’s mining sector right now?
MZ: There are many people who want to invest in SA. In fact when I talk to other CEOs they tell me that this is not an issue. They will continue working together with government. They are actually happy that if they want to engage with me I engage with them. Go and ask the CEO of Lily Mine, where three people are trapped right inside the mine...I spent seven hours there, talking, engaging and calling for help so that our people can be helped. And finally we agreed that we are closing the mine. So I engage, it’s my open-door policy.
BDTV: Can you empower if you are bound by the same constraints the private sector is when you have a force like a slump in the commodity prices to contend with?
MZ: We are going to give it our best shot. The reality is that this moment gives us an opportunity because some of the assets are being brought back because of restructuring by other mines, they belong to us. They are going to belong to us now, which will make it easy for us to attract new entrants to this environment and move. The good news is that we all know that commodities are beginning to find their way up, which means we are looking forward to a boom in the near future and we should prepare for it. As much as we should prepare for the bust next time so that we don’t cry and people do not lose their jobs because we’ve failed to prepare properly...we are now beginning to prepare for the boom.
BDTV: So where SA could be looking to buy distressed assets as well and that could fall under the African Exploration, Mining and Finance Corporation, how would government look to finance something like this, buying distressed assets in SA?
MZ: We are opening it up because currently as government we are also facing our own financial challenges and that would put us under a bit of stress. We’re opening it up to new entrants, opening up to new investors...where there are lucrative assets we should be able to find new entrants in the industry and move forward. Where we need to channel to the mining company we will definitely do so, but it will not be a blanket approach.
BDTV: What kind of progress are we seeing with the MPRDA (Mineral & Petroleum Resources Development Act) and the updating of the Mining Charter?
MZ: We have impressed upon our government lekgotla and all the stakeholders the importance and the urgency of the MPRDA. It is in Parliament and it has to be concluded. I believe we have support that this is a matter of urgency for us to ascertain policy certainty.
MOSEBENZI Zwane is Mineral Resources Minister.
BUSINESS DAY TV: Lower commodity prices and rising cost pressures have raised the spectre of more job losses in the mining sector. Already companies have informed the mines ministry of their intention to cut 32,000 jobs. So when talk around the sustainability of mining in SA has never been larger, SA’s Minister of Mineral Resources, Mosebenzi Zwane, joined Alishia at this year’s Investing in African Mining Indaba.
Minister, given the pressure that SA’s mining sector is facing right now both global and domestic forces, is the DMR (Department of Mineral Resources) and industry in crisis mode?
MOSEBENZI ZWANE: We’re dealing with a tough situation. We shall overcome it. We’re engaging our stakeholders and everybody and government largely, we shall overcome, we will revive this industry and we’ll move forward.
BDTV: Avoiding the extent of job losses outlined right at the top is among your top priorities right now. From your engagement with mining companies, with unions and given the harsh realities that we face right now, what is your understanding of the room industry has to manoeuvre on this?
MZ: If we are to be frank I think we have a bit of room to manoeuvre and save jobs. I am asking the industry to reinvest and prepare for the boom because the boom is coming. It will come. This, too, shall pass and people will be able to make their business there. Where there are some restructurings, we will ask new entrants to take over the mines so that people do not lose their jobs.
BDTV: Okay, so you’ve gotten much backlash for suspending all operations at Glencore’s coal mine because of the way it planned to carry out job cuts. It coincided with the news at the time that it was going into business rescue, now it’s been sold to Tegeta Exploration and Resources. It’s owned by the Guptas and it’s a sale that you helped conclude. What exactly did you bring to the table in that negotiation?
MZ: I didn’t help any deal to be concluded. I just said people must talk and try and help us to save jobs. And if they can do it speedily, to not allow their egos and so forth and I was out.
BDTV: And with that 3,000 jobs saved, yet Oakbay Resources has been in the spotlight for many transgressions within the mining sector, so what box-ticking, or criteria, is used when awarding new licences, given history?
MZ: We do not become part of the transactions and the negotiations unless theres a dire need when facing situations like this where massive job losses are going to result. So we get involved during the section 11 and that’s where we get involved. When people are ready and want to change ownership and transfer, then we get involved.
BDTV: How does this achieve BEE objectives exactly because the perception is that you’ve sold to a Gupta-controlled company and the Guptas are not South African?
MZ: Must I talk on behalf of the Guptas and say they are now citizens? I believe people should check their facts and be correct about their facts. As far as I know Tegeta’s majority shareholding is black-owned. That is a fact that you can go and check and then come back and argue if it’s not like that. That’s what I know.
BDTV: And you’ve made it clear today, 51% black shareholding within that company. You’ve been quoted as saying that one of your responsibilities is to attract investment into the country and you can’t attract investment if you don’t talk to people like the Guptas. How are you rating investor appetite in SA’s mining sector right now?
MZ: There are many people who want to invest in SA. In fact when I talk to other CEOs they tell me that this is not an issue. They will continue working together with government. They are actually happy that if they want to engage with me I engage with them. Go and ask the CEO of Lily Mine, where three people are trapped right inside the mine...I spent seven hours there, talking, engaging and calling for help so that our people can be helped. And finally we agreed that we are closing the mine. So I engage, it’s my open-door policy.
BDTV: Can you empower if you are bound by the same constraints the private sector is when you have a force like a slump in the commodity prices to contend with?
MZ: We are going to give it our best shot. The reality is that this moment gives us an opportunity because some of the assets are being brought back because of restructuring by other mines, they belong to us. They are going to belong to us now, which will make it easy for us to attract new entrants to this environment and move. The good news is that we all know that commodities are beginning to find their way up, which means we are looking forward to a boom in the near future and we should prepare for it. As much as we should prepare for the bust next time so that we don’t cry and people do not lose their jobs because we’ve failed to prepare properly...we are now beginning to prepare for the boom.
BDTV: So where SA could be looking to buy distressed assets as well and that could fall under the African Exploration, Mining and Finance Corporation, how would government look to finance something like this, buying distressed assets in SA?
MZ: We are opening it up because currently as government we are also facing our own financial challenges and that would put us under a bit of stress. We’re opening it up to new entrants, opening up to new investors...where there are lucrative assets we should be able to find new entrants in the industry and move forward. Where we need to channel to the mining company we will definitely do so, but it will not be a blanket approach.
BDTV: What kind of progress are we seeing with the MPRDA (Mineral & Petroleum Resources Development Act) and the updating of the Mining Charter?
MZ: We have impressed upon our government lekgotla and all the stakeholders the importance and the urgency of the MPRDA. It is in Parliament and it has to be concluded. I believe we have support that this is a matter of urgency for us to ascertain policy certainty.
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