Friday , July 12 2024

SA’s economy remains dependent on mining

South Africa’s President Cyril Ramaphosa said mining has a crucial role to play in building the country’s economy.

Ramaphosa urged the Mining Indaba 2024 to prioritise deliberations on how to breathe new life into mining, to strengthen mining value chains, and to enhance beneficiation.

“For nearly 150 years, mining has been a pillar of the South African economy. It currently contributes roughly 7.5 percent towards GDP and accounts for some 60 percent of South African exports by value.

“Working with industry and labour, the democratic government has been able to effect wide-ranging and sustainable transformation of the sector over the past three decades,” said Ramaphosa, adding that his government is willing to collaborate with the private sector, amid headwinds in the mining sector.

“As government we are alive to the reality that without bold, transformative reforms to the logistics sector, mining cannot flourish. We are working hard, in partnership with industry, to ensure this roadmap is implemented without delay.

“Finally, we committed in 2023 to improve the regulatory environment by developing and putting in place a new cadastral system to assist in the operation of a modern mining rights administration system,” said Ramaphosa.

He said his government  is committed to work towards overcoming the challenges the mining industry faces, indicating that his government is aware of the strong headwinds the industry faces and persistent challenges impeding mining performance.

“Globally, commodity price volatility, high energy prices, geopolitical tensions and a global cost of living crisis are playing a significant role in dampening the business operating environment.

“Domestically, the energy crisis and port and rail bottlenecks are putting serious pressure on miners’ operational costs. Illicit mining, cable theft and infrastructure vandalism place a further strain on mining output and returns,“ said the President.

Ramaphosa said through the Electricity Action Plan, the government has taken several critical measures to improve the performance of existing generation fleets and to add new electricity capacity.

“The Department of Mineral Resources and Energy has secured 1 384 MW of new generation capacity that is currently in construction or already in operation.

“The Department has released requests for proposals for the procurement of 5 000 MW of renewable energy under Bid Window 7, 2 000 MW of gas-to-power and 615 MW of battery storage,“ he said.

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