NEXT year will be the 20th year the Mining Indaba has been held in Cape Town. Billed as the biggest mining investment conference in the world, it is being attended this year by about 7,500 delegates. It is a huge money-spinner for the city — and for the indaba’s owners.
But there are many dangers attached to this. One is the manner in which the hotels have seized on the opportunities. Those attending regularly tell me they have noticed a 60% increase in room rates over the past three years. This is a case of the flea biting the dog to death.
Attending the Mining Indaba requires time and money. I calculate that delegate fees must have brought in about R120m.
Then there’s sponsorship, partnerships and stands. I don’t know what these produce but my guess is that, overall, the indaba must deliver gross revenues north of R300m. It’s a great business model.
But is there really any reason for the indaba to continue to be held in Cape Town? Twenty years of looking at the same mountain — even though Capetonians say they just "lerrve" it — may be beginning to pall, especially given the antipathetic attitude adopted by South African governments over the past two decades to the mining industry.
There are many sides to this story. The African National Congress (ANC) believes firmly that the South African industry was built on the backs of black lives and sweat. And, taken simplistically, that’s true enough. But that is not a good reason to damage its ability to contribute massively to the country’s future.
Already, the South African industry has missed the benefits of at least two extraordinary commodity bull runs, the like of which is unlikely to be repeated in my lifetime.
Now it has to confront a major, unorchestrated and ill-defined shift in labour relations, which neither the industry nor the government is able to control.
What the Marikana tragedy demonstrated was widespread disaffection by a younger class of employees who know the value of social media and are able to co-ordinate their actions, much of them unhappily violent.
Nor has it helped that the talk of nationalisation lasted for more than a year and that, despite what the ANC says, it remains an ill-defined bogey. When that is set alongside the arbitrary seizure some years ago of private ownership of mineral rights without compensation (some would call that theft), the nervousness of investors can be understood.
Finally, there was the intemperate response of Mineral Resources Minister Susan Shabangu to the announcement by Anglo Platinum that a year-long review of its operations had signalled the need to close shafts, a move that would throw as many as 14,000 mineworkers out of work. Given that the Department of Mineral Resources has earned a reputation for its hard-nosed approach — and has been accused of gross deviousness in the issue of licences — Shabangu’s attitude either needs to be softened or she should be moved to another position. The mining industry in South Africa is too fragile at present for hectoring, bullying and inefficiency.
The other side of the coin is that the managers of the South African mining industry have been indolent. They have rested on hard-won laurels as the experts in deep-level hard-rock mining for too long. They have failed conspicuously to adapt to the new technologies that have been advanced with singular success elsewhere.
There is ample justification in the view that the leaders of the South African industry have been mired for too long in intransigence.
Entrepreneurial flair has been absent. An Ernest Oppenheimer, even in the vastly changed circumstances of the 21st century, would never have been permitted the Rip van Winkel approach of modern-day managers.
But all this leads your columnist to ask whether, in these circumstances, a change of venue for the Mining Indaba isn’t now appropriate. Other African countries have learnt the lessons and have adopted intelligent investment codes and a friendliness to mining companies.
The indaba’s MD, Jonathan Moore, would probably respond by asking why it should be thought necessary to fix something that isn’t broken. It is true that Cape Town has much to offer and, for those who want to make a South African holiday after the event, it’s a good jumping-off point.
But change for the sake of change sometimes has its own virtues. The most obvious alternative African city is Nairobi, the East African capital and obvious start for the great East-West continental cornucopia of many much sought-after commodities — bauxite, high-grade iron ore, copper, gold, coltan, diamonds, and oil and gas.
It is not that I advocate changing the indaba’s city of choice, but I do wonder whether, 20 years on, there is not good cause to make a move. Even the threat of it might send a salutary signal to Pretoria that a change in approach and philosophy is essential.
It does not help that ANC secretary-general Gwede Mantashe accuses business of failing to support the government’s economic development desires. If he really thinks that and wants to know why, the answers lie within the attitudes of the party of which he is a leader.
WHAT on earth caused the frightful fracas and near riot at the Beit Bridge border post early last month? And why was it necessary for Zimbabwean Home Affairs Minister Kembo Mohadi to appeal to his South African counterpart, Naledi Pandor, before matters were set right?
A 10km traffic back-up is simply unacceptable.
After Mohadi’s protests, the congestion disappeared smartly, but it required a massive deployment of immigration officers to fix things.
Travellers had good cause to complain, and to describe all the congestion and suffering to which they were subjected as uncalled for and absolutely unnecessary.
Beit Bridge is the country’s busiest South African border post and handles more than 25,000 travellers a day during holiday periods.