Minister Susan Shabangu has done a good job of pretending everything is hunky-dory in the mining sector today. It is a pity that she has lost touch with reality.
In the Minister's address at the Mining Indaba this morning she tried to pull the wool over the eyes of the mining industry. The Minister has obviously been taking lessons from President Zuma, who attempted the same in Davos recently.
Although the Minister has said all the right things today and was relatively upbeat about the mining industry and its future, the reality is far from picturesque. Job losses, wildcat strikes, violence, decreased demand and government bullying are the key ingredients missing from the Minister's assessment.
The real problem in the mining industry is the toxic combination of a government that does not understand the economic realities of the industry, and trade unions more interested in their own power and money than the jobs of their members.
Until government takes the necessary steps to change this situation, we will not see growth and stability in the sector.
In fact, conditions are likely to get worse if the government goes ahead and passes amendments to the Mineral and Petroleum Resources Development Act, which have already been passed by Cabinet and will come before Parliament this year. Uncertainty will increase and investors will be chased away, which will result in a loss of jobs and money to the fiscus.
Government policy on mining should be aimed at maximising employment and revenue for the fiscus, not hampering it.
James Lorimer, Shadow Minister of Mining