File image: Reuters

Delegates at the Alternative Mining Indaba have called on the government to study the costs and benefits involved in the mining industry to determine to what extent the industry does help to develop the South African economy.

They have also called on the government to determine who received the benefits and who paid the costs attached to the industry, pointing out that many of the ANC members who made it to the top of the national executive committee list were involved with mining companies.

“We should not be attracting investment at any cost,” David van Wyk, the head of research at Bench Marks Foundation, told Business Report at the end of the Alternative Mining Indaba’s three-day summit.

Presentations at the Alternative Mining Indaba in Cape Town highlighted the difficulty facing the government as it tries to address the demands of international investors as well as the needs of a large portion of the ANC’s voting base.

Commenting on the government’s efforts to placate the mining investment community and ease its concerns about investing in South Africa, Van Wyk said: “We shouldn’t be making it easier for mining to take place; to the extent that communities and the environment need to be protected, we should be making it harder.”

Mining companies argued that they were job creators and yet there was massive unemployment in the communities where there was mining activity, he argued.

“When it comes to providing jobs, the local population is overlooked because mining companies want to be profitable from day one and so will not undertake the necessary training.

“This is partly why so much mining activity is done by a population of migrant labour, which moves around the country following mining activity,” said Van Wyk, who added that it was easier to control and retrench migrant labour.

Hundreds of delegates representing labour and communities from across Africa participated in the Alternative Mining Indaba and listened to research findings on the damage being done across the continent by mining companies from Paladin in Malawi to Lonmin in Rustenburg to Glencore in Zambia and to diamond mining in Zimbabwe.

In his presentation, Alvin Mosioma of Tax Justice Network said the ease with which complex corporate structures could be set up to avoid tax meant African governments did not receive the benefit of their countries’ resources.

Van Wyk said it was time for the South African government to look beyond mining for the answer to the country’s development needs.

A few blocks away, at the Cape Town International Convention Centre, Gold Fields chairwoman Mamphela Ramphele told the Investing in African Mining Indaba that the mining industry had to change its business model. Sapa reports Ramphele as saying mining revenues were not shared equitably.

“Unfortunately, South Africa has sustained an extractive system that started with mining and energy companies and now includes monopolies in many other sectors… we often avoid difficult conversations because we believe the business of business, as one chief executive told me, is to make money regardless of the socio-political environment,” Ramphele said.

She said mining should evolve from a core business focused on the extraction and export of resources to a cluster of mining, agriculture and manufacturing, using all the mine’s available resources.