[miningmx.com] — BENEFICIATION was not the solution to end all problems as far as job creation in the mining industry was concerned, according to the National Planning Commission (NPC), which has said the development of supplier industries could be much more labour absorbing.
The NPC, chaired by Minister in the Presidency Trevor Manuel, on Friday released its National Development Plan – a framework on the policy directives needed to fast-track economic growth for the purpose of eliminating poverty in South Africa by 2030.
The report said the mineral cluster could add 300,000 jobs to the economy by the project’s deadline.
“In general, beneficiation is not the panacea because it is usually highly energy and capital intensive, contributing little to overall job creation,’ read the report.
“Substantially more attention will be devoted to stimulating backward linkages or supplier industries (such as capital equipment, chemicals, engineering services) especially as demand is certain, there is an opportunity for specialised product development, and the product complement is diverse.
“They are also more labour absorbing than typical downstream projects. Such products have the potential for servicing mining projects globally, an advantage should the commodity boom persist.’
The report listed electricity shortages as a main constraint for beneficiation. “As long as electricity is scarce, there will be a trade-off between beneficiation and other more labour-absorbing activities,’ it read.
The report said that mining companies should have an explicit requirement to participate in local development, and that the mining charter should be aligned to this.
The NPC also took stock of South Africa’s mining ills, and why the industry has shrunk by 1% per year between 2001 and 2008.
“The mining industry is smaller now than what it was in 1994. This is an opportunity lost as estimates show the mining sector could expand by 3 percent to 4 percent a year to 2020, creating a further 100,000 jobs.
“The central constraints are uncertainty in the regulatory framework and property rights, electricity shortages and prices, infrastructure weaknesses especially in heavy haul services, ports and water, and skills gaps.’
