'We won't be bullied,' says Anglo's Gomwe

David McKay | Tue, 07 Feb 2012 10:52

[miningmx.com] – IN an allusion to its dispute with Chile’s state-owned mining company, Codelco, Godfrey Gomwe, Executive Director of Anglo American South Africa, said his company would not be bullied and that it would stand up for its rights.

Speaking at the Investing in African Mining Indaba, Gomwe also reiterated the message of last year's speech delivered by CEO Cynthia Carroll, that host governments should abide by the rule of law.

“Anglo American has shown many times that it will not hesitate to stand up for its rights and for its beliefs. That remains as true today as it has been in the past,” said Gomwe, who was delivering a paper in Carroll’s stead.

“We will never allow ourselves to be intimidated or bullied into departing from the path we know to be right. We have the courage of our convictions,” he added.

Anglo American is involved in litigation with Codelco, which wants to exercise its right to buy a 49% stake in Anglo American Sur – an Anglo American subsidiary that owns the valuable Los Broncos mine, among other copper-mining assets, in Chile.

Last year, however, Anglo American pre-emptively sold a 24.5% stake in Anglo American Sur to Mitsubishi – a development that escalated within a month, prompting Codelco to launch criminal proceedings against Anglo.

On January 27, Carroll urged Codelco to engage in commercial negotiations to settle the matter rather than waiting for the courts to decide. But Gomwe’s message also hints at Anglo’s determination not to back down amid government pressure.

“The first and most fundamental role of government is to ensure the rule of law. A clear and fair regulatory framework, upheld by a strong, independent judiciary is vital,” said Gomwe.

“Mining companies need to know that their property rights will be respected and protected. We make major investments and we need to be able to plan with confidence for the long-term future,” he said.

“Wherever we operate, we look to the courts to be independent and impartial in upholding the rights of citizens and companies. As we have seen again recently, the courts in South Africa demonstrate those qualities.

“We expect the same fair treatment elsewhere in the world, and we are confident that we will receive it.”

Gomwe's comments also come amid intense activity in South Africa’s regulatory environment, where a study commissioned by the government into the merits and demerits of nationalisation has delivered a verdict that an aggressive resource rent tax should be applied instead of state ownership of mines.

Said Gomwe: “If the fundamentals of the rule of law are in place, the other key building block is for government to create a sound economic policy.

“It is critical that taxation and royalty regimes enable mining companies to earn a fair return on their investment and are not subject to arbitrary and unpredictable change,” he said.

» How to guide

COMMODITY MARKETS: Miningmx speaks to Adrian Saville, CIO and founder of Cannon Asset Management, about the outlook for commodities and SA's mining sector.

CLICK HERE FOR MORE MINING INDABA 2012 VIDEO

CONFERENCE COVERAGE

PRINT PRODUCTS

› Mining Yearbook 2010

› Mining Yearbook 2009

› Mining Yearbook 2008