Nationalisation debate goes on

The decision by the disciplinary committee of the ANC to suspend ANC Youth League president Julius Malema from the party would not halt the debate started by his demands to nationalise mines without compensation, industry and academics said last week.

Chief executive of the South African Chamber of Mines Bheki Sibiya said Malema’s removal would “complicate our lives”.

“It (Malema’s suspension) may not settle the nationalisation debate. We would wish the debate to be completed with the hope that it doesn’t come back. If Malema is not there at its conclusion, it may come back. His hardship is going to be a risk of the future.”

Last week, an ANC disciplinary committee found Malema guilty of bringing the party into disrepute and for sowing division. It recommended Malema’s suspension from the ANC for five years and that he step down from his position.

Since 2008 Malema has been calling for the controversial nationalisation of mines to realise his interpretation of the Freedom Charter, claiming it would help to ensure economic freedom in the lifetime of unemployed youth. According to the charter, people shall share in the country’s wealth, and the “mineral wealth beneath the soil, the banks and monopoly industry shall be transferred to the ownership of the people as a whole”.

On Friday, academic Steven Friedman said the debate for the nationalisation of mines was an attempt by some businessmen to take advantage of certain mines over other mines. The debate would continue whether or not Malema was suspended from the ANC because there were people trying to get the idea implemented.

“If you read the proposal, this (nationalisation of mines) has nothing to do with poverty, Julius Malema is associated with tender practices and that is why there were parties in Limpopo and the North West when the disciplinary committee found that he ought to be suspended. People with political influence are raising the debate because they want to get a stake in mines, the debate will continue whether or not Malema is suspended.”

The mining industry spends R400 billion a year on investments, and has close to R2 trillion of the market capitalisation of the JSE.

But the call for the nationalisation of mines has been strongly opposed by government and industry heavyweights, including Minister of Mineral Resources Susan Shabangu and chief executive of Anglo American Cynthia Carroll, who said it would damage the economy as mining companies would not invest if their assets were not secured.

Even Roger Baxter, the departing strategy executive of the mining chamber, was quoted in miningmx warning that nationalisation would set South Africa back 30 years and would not solve the unemployment problem.

However, ANC spokesman Jackson Mthembu said the task team that was appointed to study state intervention in mines, would soon report to the ANC national executive committee.

“The investigation has nothing to do with anyone’s suspension. We are interested in the merits and demerits of the nationalisation of mines. This has nothing to do with Malema, the research has been going on since the national general council, and it is about to be complete.”

When asked about the members of the task team, ANC secretary-general Gwede Mantashe said the names were irrelevant.

The three-person nationalisation task team consists of Paul Jourdan, an independent South African mineral policy analyst and former chief executive at Mintek, economist Pandy Pillay, and an executive director at the Human Sciences Research Council Margaret Chitiga-Mabugu.

Friedman said he only knew of the first two. Although they were both from “a left background”, he would doubt that they would recommend nationalisation of the mining sector, although he believed they would probably recommend to the ANC national executive committee “some form of state intervention” in the sector.

The task team has investigated a sample of countries where the nationalisation has come under discussion including Chile, Norway, Sweden, Finland, Zambia, Venezuela, Namibia, Botswana, Malaysia, China and Australia.

Mining bosses said the debate was not over and that the issues of youth unemployment would have to be resolved.

Lonmin’s chief executive Ian Farmer said: “The debate around resource nationalism is important in South Africa, and indeed elsewhere. It’s a debate that needs to be had openly and constructively.

“The key issue is in finding a balance between fairness and competitiveness which allows mining companies to make the long-term investments necessary to ensure the sector continues to be one of the country’s most significant economic drivers and employers.”

Chief executive at Impala Platinum David Brown said the nationalisation debate would not go away because Malema was suspended.

“If we (the mining industry) focus on correcting things like reducing poverty. We voiced our concern to the mining industry… The debate is less about mining but about creating jobs,” he said.

Friedman said damage was done to the economy because the debate had been misrepresented. “Investors are fooled by what is happening.”

Earlier this month thousands of protesters held a march for economic freedom and handed over demands to the Chamber of Mines, the JSE and the government. - Dineo Matomela