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OPENING ADDRESS BY MINERAL RESOURCES MINISTER, THE

HONOURABLE MOSEBENZI J. ZWANE, ON THE OCCASION OF THE 2017


ANNUAL INVESTING IN AFRICAN MINING INDABA, 6TH FEBRUARY 2017, CAPE
TOWN, SOUTH AFRICA

Organisers of the 2017 Mining Indaba,


The new Managing Director and our Programme Director, Mr Alex Grose,
Co-Programme Director, Mpho Makwana,
Fellow Cabinet Ministers of the Republic of South Africa,
Deputy Minister of Mineral Resources, Hon. Godfrey Oliphant,
Chairperson of the Portfolio Committee on Mineral Resources, Hon. Sahlulele
Luzipho,
Chairperson of the Select Committee on Land and Mineral Resources, Hon. Olifile
Sefako,
Your Excellencies, Ministers and Deputy Ministers present,
Leadership of organised labour,
Captains of industry, and members of the investment community,
Representatives of civil society and communities,
Members of the diplomatic corps,
The investment community at large,
Media here present,
Distinguished guests,
Ladies and gentlemen,

On behalf of the government and people of South Africa, let me welcome you to our
beautiful country, and to this years Investing in African Mining Indaba.

Mining and mineral resources have been central to civilizations for millennia, and this
is expected to continue for the foreseeable future. It was the twin discovery of
diamonds and gold, in South Africa in the late 19 th Century that spurred on the
establishment of a modern mining industry and our economy at large.
Though it has been 150 years since the discovery of the alluvial Eureka diamond, in
the Northern Cape, mining continues to be a pillar of economic growth in South
Africa. It contributes about 8 percent directly to South Africas GDP and just under
460 000 direct jobs. With an estimated 2.5 to 3 trillion US Dollars in non-energy
mineral reserves still in-situ, we are looking forward to another 150 years of mining in
South Africa.

We therefore invite the investment community and the mining industry at large to join
us as we commence the next century of mining. As we move mining forward, let us
take everyone along, and ensure that indeed the mineral wealth beneath our soil
benefit all South Africans.

Also, our State Owned Mining Company (SOMCO) has been operating its first coal
mine, and continues to contribute to the objectives of the National Development
(NDP) which seeks to eliminate poverty, increase employment and reduce inequality
by 2030. The company currently has a number of minerals under its portfolio.

In August 2016, South Africa hosted the 35 th International Geological Congress


(IGC). I wish to express our sincere appreciation to the organisers and all the
participants from across the globe for making it such a success.

The IGC also served to raise interest on prospectivity for mineral and upstream
petroleum resources in South Africa through the application of new techniques in
mapping. To encourage greater investment in prospecting and development, we
have directed our Council for Geoscience (CGS) to work on a high intensity 10-year
mapping programme to develop an integrated, multi-disciplinary geological platform
at a scale of one in fifty thousand [1:50, 000] nationwide.

Special recognition is also given to the Organization of African Geological Surveys


(OAGS) which continues to facilitate cooperation between Geological Surveys and
the attainment of the Africa 2063 development vision. In this regard, we congratulate
Nigeria on their assumption of the Presidency of the OAGS. We call upon the
international community to support the OAGS programmes.

When we met here last year, we reflected on the cyclical nature of mining, and the
fact that we were in the winter season. At that time we predicted that the winter will
come to an end, and that we should be better prepared for the new summer in the
sector. There are now signs that we are entering a new spring. A new balance is
emerging in the demand and supply for mineral resources. There has been a
remarkable recovery of prices during the latter part of 2016, more particularly with
commodities such as coal, iron, ferromanganese and zinc. These market dynamics
need to be entrenched and supported by stakeholders working in concert to ensure
the sustainability and resilience of the industry.

This year we mark the centenary of the former President of the African National
Congress Comrade O.R Tambo, who would have celebrated his 100 th birthday this
year. The centenary is a reminder for us to continue to strive for the equality and
shared economic growth which Comrade O.R and his contemporaries championed.
In the mining sector, we must remain committed to the principle of shared prosperity
and responsible investment. We ask the investment community to seize the
opportunity to partner with black people, communities and workers meaningfully in
their operations.

As I committed last year, government will do its part by ensuring an enabling


environment for investment in South Africa. We have put all efforts in place to ensure
that amendments to the principal mining legislation - the Mineral and Petroleum
Resources Development Act - are processed and finalised as a matter of urgency.
This process is well underway and public hearings are taking place towards the
finalisation of the Bill. We expect it to be concluded by June 2017.

On the revised Mining Charter, the regulatory tool governing transformation in the
sector, we have consulted extensively with stakeholders. The final Mining Charter
will be gazetted by March 2017 and will be reflective of the views of stakeholders, in
the interests of South Africa and provide for investor certainty. We call upon investors
to come to South Africa and engage us frankly as we move towards transformation
of our economy. We will continue to have an open door policy.

As a further contribution to creating an enabling environment for shared prosperity,


the stability of industrial relations has been a focus of stakeholders. This was
encapsulated in the Framework Agreement for a Sustainable Mining Industry, led by
the President of the Republic of South Africa, His Excellency President Jacob Zuma,
and signed by stakeholders in 2013. We welcome the peaceful conclusion of the
2016 wage negotiations in the platinum and coal sectors and see this as a sign of
the further strengthening of relationships and systems put in place. We wish to thank
all the stakeholders for upholding the spirit of the Framework Agreement during the
negotiations period.

The government, also remains committed to enhancing the ease of doing business,
and thus retaining the countrys reputation as a preferred investment destination. We
have moved to improve regulatory efficiency through the integration of the
applications for mining and related rights, water use and environmental permits.

We have established an Investment One Stop Shop, overseen by the Inter-


Ministerial Committee on Investment. The One Stop Shop works to improve
regulatory efficiency by providing multiple services from a single point, providing
advice and addressing any blockages identified for those interested in conducting
business in our country.

We have also established an integrated plan for economic growth and development,
the Nine Point Plan which looks at cross-cutting issues such as infrastructure
development, research, development and innovation as well as sectoral plans
including mining and mineral beneficiation.

Beneficiation remains a priority in South Africa, and we are inviting investors and
mining companies, to look to this as an opportunity for partnership and a mechanism
for ensuring stable and growing demand for mineral resources. In this regard, we
have developed a programme for Special Economic Zones, with an array of tax and
investment incentives as well as bulk infrastructure to support the growth of mineral
beneficiators. An example of this is the Musina Metallurgical Complex, in the
Limpopo Province. We also have world-class institutions including Mintek, an entity
reporting to the Department, that stand ready to partner with business in the
development and adoption of competitive technologies and processing for
beneficiation.

We welcome the positive manner in which investors have responded to this national
imperative, and will continue work to strengthen enablers for beneficiation, including
the security of supply of energy.
In our efforts to support investment in mining and beneficiation, we have a particular
focus on the growth and promotion of small and medium sized enterprises. We are
of the firm view that a new era of junior to mid-tier sized mines is upon us. The large
mining giants of today had their genesis in the junior mining sector. We further
believe that most job opportunities lie with small to medium companies, hence in
2017 we will be focusing on the Promotion of Investment, with a special focus on
junior miners. We will continue to give them the support to enable them to thrive. We
will further be hosting a an investment dialogue in Auditorium 2 at 14:00 today,
looking specifically at junior mining, including potential projects, procurement
opportunities as well as government and State-Owned Entity initiatives to support
junior mining. We invite you to join us at that session.

An area which continues to receive priority attention is that of health and safety. The
regrettable accident which occurred at Lily mine in Mpumalanga Province a year ago
remains in our hearts and we will continue to toil to ensure that the families get
closure.

The Department will continue to enforce the legislation consistently, and I have full
confidence in the officials who administer these laws.

For mining to be sustainable well into the future, the industry must place greater
value on the lives of workers. We collectively have the responsibility to ensure that
each and every one of them remains unharmed, so Let us continue to be committed
to achieving the goal of zero harm. We want to commend all the mining companies
who have achieved the laudable milestone of operating for more than 12 months
without any fatality during 2016.

We also remain ceased with ensuring that the illegal mining activities are prevented.
In this regard, government will continue to collaborate with stakeholders in
implementing the appropriate measures which will eradicate the illegal operations.

Closely linked to this element is the menace of illicit financial flows from the mining
sector. Financial tools employed to avoid taxes and the fair share of mineral rents to
the host governments only act to undermine the trust between stakeholders, and
make for long term fragility of investments and the sector in South Africa, on the
continent and globally. Let us work together to change the legacy of our sector and
ensure that it is seen by all as a valued partner in development.
As I conclude, I wish to thank you for your continued interest in the mining sector of
our country and continent. Your annual presence here is confirmation that South
Africa remains a key investment destination for mining. Indeed South Africa is open
for business, and I invite you to partner with us as we move the industry into the next
century.

Re a Leboga.

Siyabonga.

Ndi a livhuwa.

I thank you.

Issued on behalf of the Department of Mineral Resources


06 February 2017

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