An employee at a platinum smelter. The mining industry on the African continent is under investigation.Photo: Reuters
JOHANNESBURG - The mining industry on the African continent has a bad history when it comes to exploitation of workers, and the mineral wealth of countries and South Africa is no exception.

However, at the Human Rights Commission’s two-day seminar, Business and Human Rights Dialogue, in Sandton, the Chamber of Mines' senior executive for public affairs and transformation, Tebello Chabana, pointed out that not only was his organisation aware of the problems, but it was also actively involved in making the mining business more ethical.

Chabana explained that the Chamber was aware of the alleged involvement of the mining industry in illicit flows and that Parliament had had numerous deliberations in the past two years on the matter.

“Illicit financial flows could be in the form of base erosion and profit shifting (BEPS), mis-invoicing and criminal activities of illegal product trading,” said Chabana.

In 2015, an AU high-level panel headed by former president Thabo Mbeki stated that some $50billion (R590bn) a year is lost to Africa through illicit flows.

In 2016, the UN Conference on Trade and Development (Unctad) issued a report also alleging widespread mis-invoicing in the mining industry in Africa, including in South Africa.

Currently the Chamber is working with Parliament towards improving transparency through information sharing and improving data collection.

In 2017, the Chamber commissioned an independent review by Eunomix Research regarding the 2016 Unctad report on trade mis-invoicing.

“We are also aware of the Recommendations of the Davies Tax Committee (published in November 2017) to the Treasury, in response to the Organisation for Economic Co-operation and Development’s BEPS Report,” said Chabana.

“Some recommendations might culminate in legislation. We await to be consulted on possible legislative proposals,” he added.

“In line with our Membership Compact, our members have committed to implement and maintain ethical business practices and sound systems of corporate governance.”

Chabana also pointed out how the mining industry had contributed to the economy last year.

Despite its ills, the mining industry is the backbone of the economy, with:

Seven percent of GDP, with another 11percent in indirect contributions.

It paid R5.8bn in royalties, and taxes of some R16bn.

Exports of R307bn, representing 27percent of the country’s R1.1trillion total.

Mining sector employment rose to 464667, or 6.1percent of private non-agricultural employment.

Those employees’ earnings amounted to R126bn.

The industry is responsible for another 1.4million jobs - people employed by suppliers to the industry.

Gross fixed investment in mining of R93bn, representing 18.2percent of private and 10.8percent of total fixed investment in the economy, asserted Chabana.

The Chamber also supports wealth distribution with its mining charter designed to contribute to the broader country agenda of transformation and inclusion.

The elements include but are not limited to ownership; employment equity; community development; skills development; enterprise and supplier development. 

- African News Agency (ANA)