JOHANNESBURG - Gold and platinum group metals (PGM) miners will limit their investment in existing South African mines to sustaining capital, global ratings agency Moody’s Investors Service warned on Tuesday.
Douglas Rowlings, Moody's vice-president , a senior analyst and author of the report titled, Restructuring of South African operations is credit positive for gold, PGM miners, said South Africa's appeal to mining companies had continued to decline, according to the Fraser Institute.
“Gold and PGM miners will limit their investment in existing South African mines to sustaining capital. Without the substantial expansionary investment required to reconfigure loss-making mining operations and make them profitable, mines will either be restructured or closed,” said Rowlings.
The report comes days after Chamber of Mines chief executive, Roger Baxter, told a thousand delegates at the Africa Down Under mining conference in Perth, Australia that governance and policy challenges in South Africa had eroded business and investor confidence.