IN her recent FM column, Ann Crotty makes an argument that deserves a serious answer. The JSE’s problem, she writes, is not that raising capital is hard, but that there is little demand for it. One change, she writes, could shift that: overhaul the mining laws that have made South Africa unappealing to foreign investors, and a mining stock boom could follow.
Crotty’s diagnosis is half right. Our regulatory environment has been slow, uncertain and too often hostile to anyone trying to build something. Prospecting rights sit in backlogs. Licensing has become a byword for delay. I agree with her that the rules need to change.
Where I part ways is on the purpose of reform. Her column treats mining law as a single lever, pulled to attract foreign portfolio money. From where mining communities stand, that framing leaves out the people who live on top of the resource.
South Africa has already run the experiment of mining booms that bypass the places doing the mining. Walk through Khutsong, Wedela, the villages of Moses Kotane or the townships around Welkom and Klerksdorp. These communities gave a century of labour and land to some of the richest ore bodies on earth. What many have left is subsidence, dust, unemployment and abandoned shafts where desperate young men now mine illegally at the risk of their lives. The share price was never the problem in those decades; the distribution of value was.
So when I hear that a regulatory fix could spark a boom fitting for the era, my question is simple: a boom for whom?
Capital is already choosing
In the same week as Crotty’s column was published, Gold Fields confirmed it is pursuing a bid worth about $27bn for Australia’s Northern Star Resources, while saying it is prepared to walk away if the price is wrong. A South African miner is committing its future growth to Western Australia.
It would be convenient to blame that entirely on our mining laws. It would also be misleading. Our gold ore bodies are deep, costly to mine and depleting. No amendment to the statute book will make a 3km-deep shaft as cheap as an Australian open pit. Regulatory reform can remove self-inflicted wounds, but it cannot rewrite geology. Policymakers who promise otherwise will disappoint investors and communities alike.
Crotty is right that demand for capital is the binding constraint. But demand does not only come from the next listed mega-project. It sits in thousands of places the JSE never looks.
It sits in artisanal miners who could be formalised into licensed, safe, taxpaying co-operatives if the law gave them a workable path. It sits in local suppliers who could provide the goods and services mines buy every day, if localisation were enforced rather than recited. It sits in agroprocessing, logistics and rehabilitation work on land that mining has already scarred.
In more than 20 years of working in township and rural economies across South Africa, I have seen that the appetite for investment in these places is real. What is missing is a legal and financial architecture that lets that demand meet capital.
What real reform looks like
The Mineral Resources Development Amendment Bill now before parliament is the moment to get this right. Reform that serves both investors and communities would do four things.
First, fix administration: clear timelines for rights, a transparent licensing system and consequences for bureaucratic delay. Investors and small miners need this equally.
Second, create a genuine legal route for artisanal and small-scale mining so that illegal mining can be turned into regulated enterprise instead of only being policed.
Third, make community benefit enforceable and measurable. Social and labour plans that exist on paper while towns decline are not a form of participation.
Fourth, tie procurement and localisation obligations to the communities closest to the operation, so a revival in mining translates into local businesses, jobs and skills.
None of this scares serious investors off. Long-term capital prefers stable host communities, predictable rules and a social licence that does not collapse at the first protest. The mining houses that understand this are already sitting at the table with community organisations.
South Africa does not need another cycle in which commodity prices rise, listed miners rerate and mining towns stay exactly as poor as they were. Crotty is right that this era of record prices is an opportunity. Let us not waste it on a boom measured only on the JSE.
Reform the mining laws, yes. But reform them so the people who live above the resource are shareholders in its future, not spectators to it.
Vokwana is founder and CEO of Kasi Catalyst, a township innovation and advisory platform, and secretary-general of the National African Federated Chamber of Commerce & Industry. She writes in her personal capacity.