President Cyril Ramaphosa's 'New Dawn' got the thumbs up from mining investors. Photo Reuters

JOHANNESBURG – Mining investors on Wednesday gave President Cyril Ramaphosa’s new dawn a thumbs up, saying that it represented a renewed drive to restore the ailing industry.

Billionaire and Ivanhoe chairperson Robert Friedland told the 25th Investing in African Mining Indaba in Cape Town that Ramaphosa had added to confidence in the industry. 

“From where I was sitting in the audience here yesterday afternoon, listening to President Ramaphosa certainly was refreshing, especially after the disastrous period which this amazing country has just emerged from,” he said.

Friedland, whose company Ivanhoe Mines owns the Platreef, with massive platinum, palladium, nickel, copper and gold resources in Limpopo, said the government also had to address its responsibility to communities.

“The new administration here, led by a man who understands the global economy very well, certainly has an extremely difficult task ahead to ensure that South Africans who suffered untold misery under apartheid don’t run out of patience with the elected government and take out their frustrations on mining companies, as they sometimes do.”

Friedland said that mining could and would deliver massive benefits for all stakeholders “if we work together”. 

“Our host communities and workers, governments and shareholders will all benefit if we take hands and deal with the challenges facing us, together,” he said.

Ivanhoe is also developing a copper deposit in the Democratic Republic of Congo (DRC), which has the potential to become the world’s second-biggest producer of the metal.

He said both South Africa and the DRC had to promote stability, adding that “money is a coward – it flees at the sign of trouble”.

On Tuesday, Ramaphosa became South Africa’s first sitting president to address investors at the Indaba. He allayed fears over the country’s land reform programme, which will include expropriation without compensation, and pledged to tackle infrastructure constraints, including electricity and rail transport pricing. 

Ramaphosa said he would announce measures to address the financial, structural and operational problems at Eskom, which has been crippled by ballooning debt and coal shortages.

An investment banker who spoke on the sidelines of the indaba said although investors were optimistic about the direction in which South Africa under Ramaphosa was heading, a lot needed to be done to attract investors.

“Although we have a charter, the period behind us has been disruptive. Some institutional investors from North America have said that South Africa has not come up in their conversations for the last five years. To get money flowing into the country will take much more than finalising the mining charter,” he said.

Eskom and community unrest at mines was cited as one of the major concerns by investors, said the banker.

“Expectations have been raised among mining communities and it has a lot to do with municipalities not being able to provide services resulting in communities disrupting mining operations to get jobs and basic services,” he said. 

Last year, the government moved to finalise the third version of the Mining Charter and bring clarity to the Mineral and Petroleum Resources Development Amendment Bill, which is expected to bolster policy certainty.

“Investors want more clarity on whether there will be another Charter in the next five or 10 years (and whether) changes or further changes will be implemented to the charter,” he said.

The Minerals Council SA, which represents 80 percent of the country’s mining industry, commended Ramaphosa’s move to assure investors of the government’s commitment to creating an enabling environment for investment in mining.

Minerals Council chief executive Roger Baxter said the body had engaged extensively with the government and other stakeholders on the challenges that have prevented the mining industry from realising its full potential.

“A collaborative approach is needed to develop and implement solutions that will see our industry grow and thrive in the future for the benefit of all. We need to get investment back in mining. We, as the industry, are fully committed to playing our part,” Baxter said.

BUSINESS REPORT