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Shabangu again discredits nationalisation

Reuters | Tue, 08 Feb 2011 13:27

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[miningmx.com] -- NATIONALISING South Africa's mines is "not the option", Mines Minister Susan Shabangu said on Tuesday in her strongest comments in a year against an idea that has unnerved investors in Africa's biggest economy.

Under pressure at the Mining Indaba industry conference to counter radical elements in the African National Congress who want state ownership of mines, Shabangu reiterated that nationalisation was "not currently policy".

But she then went on to say that nationalisation would mean South Africa missing out on a global commodities boom, just as it did for most of the last decade when prices soared and mining in countries such as China, Brazil and India posted huge growth, while the industry stagnated in South Africa.

"Is nationalisation going to give us jobs? No. We have got to make sure that we become responsible and we attract more investments, because we do need investments in South Africa," she told a news conference.

"We have a boom in the mining sector. We can't afford to miss this opportunity. We lost it the last time. It cannot happen again," she said. "I still believe, I feel very strongly, that nationalisation would not be the option for South Africa."

ANC Youth League leader Julius Malema has spearheaded the drive over the last year to nationalise South Africa's mines, which remain overwhelmingly owned and run by whites despite an ANC push for transformation.

The notion was even tabled at a major ANC policy meeting last year. Senior figures from Shabangu to President Jacob Zuma have failed to slap Malema and his backers down, suggesting the idea may have some traction in the corridors of power.

At last year's mining conference, Shabangu said nationalisation would not happen "in my lifetime" but softened her tone under the guise of ANC protocol.

Uncertainty about nationalisation and affirmative action policies to boost black ownership of the industry have caused mining investment to stagnate since 2000, although South Africa remains the world's biggest platinum and the number three gold producer.

The industry has also been plagued by a series of controversies in the administering of mining and prospecting rights, although Shabangu said on Monday a planned overhaul of the system would eliminate corruption and blunders.

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