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Date : 07/02/2006
Source: Department of Minerals and Energy
Title: Hendricks: Mining Indaba


  Welcoming address by Lindiwe Hendricks, Minister of Minerals and Energy at a Mining Indaba in Convention Centre, Cape Town

Honourable Ministers
Distinguished guests
Programme Director
Ladies and gentlemen,

I would like to formally welcome all of you to the 2006 Mining Indaba. I would like to acknowledge the presence of my colleagues, the Ministers of Mining from several African countries who are attending and participating in this conference. As African Mining Ministers we have been holding very fruitful discussions over the past few days during our African Mining Partnership (AMP) meeting. I will speak on some of the outcomes of our discussions tomorrow morning.

I would also like to welcome and thank all those who have travelled from different parts of the world to be here. I also welcome our own local mining fraternity.

The Significance of the Mining Indaba:

The Indaba, an international mining investment conference of note, has evolved alongside our 11 years of democracy. It has grown in every way and as a result we now need a bigger venue. The participation in this event by a greater number of governments as well as local players, especially the new entrants, has also increased, giving them an opportunity to network. There is still room for the African junior mining sector to participate and benefit from this conference.

We welcome the interest taken by international mining and investment organisations in this event as it highlights and recognises Africa as a key destination for mining investments. The mining industry’s potential to act as a catalyst for growth and prosperity on the African continent, presents what is arguably the industry’s most critical 21st Century challenge. Our continent contains one of the world’s greatest mineral treasure troves and even though our resources have been mined for more than a century, there are still substantial deposits. With greater levels of peace on the continent and the creation of a substantially more investment friendly business environment, we are opening up the opportunities to invest in mining on the continent.

Developments in South Africa:

Ladies and Gentlemen, the South African government in recognising the importance of the mining industry to our economy also saw the challenges and the dangers created by keeping those resources locked in the hands of a small minority. Over the past few years we have opened up the industry, and created the scope for new players to enter this industry. We look forward to our mining sector increasingly contributing towards the changing needs of the country.

Such changes are certainly in the area of black economic empowerment but also and very importantly include value addition and beneficiation of minerals. Our most recent legislation that was taken to Parliament late last year is to encourage and facilitate greater levels of beneficiation.

Some of our legislation and changes have made us unpopular with certain players in the business community, while others are sceptical about what we can achieve. There should be no doubt that through our initiatives we are looking at the long term interests of our country, and creating a climate that is conducive for broader participation, greater levels of investment and economic growth.

In all of our changes we are looking for greater private sector involvement and investments. President Mbeki put it very aptly in his state of the nation address last Friday when he said, “The years of freedom have been very good for business. I believe that this should have convinced the investor community by now that, in its own interest and as part of the national effort, it has to invest in the expansion of that freedom.”

Ladies and Gentlemen, one only has to look at the delegates attending this conference and those at the exhibition to see that our mining industry is effectively positioned to make a substantially rewarding impact not only on the South African economy but also beyond our national borders, particularly in the rest of Africa. In doing so and in seeking these opportunities the principles of social investment, community involvement, sustainable mining and good corporate government should not be left behind.

One of the reasons why our domestic mining industry is well positioned to invest in other countries is because it is unarguably the one of the most successful business "clusters" within the South African economy. Thus our mining sector includes more than just miners but also much of the value chain around the mining industry such as finance, consulting engineers, world class geologists, contract miners, component suppliers and product suppliers, etc. As a country we also have excellent education and training facilities for the mining industry. We should be very proud of what South Africa has achieved in this sector and as government we are seeking to expand the value chain so that it incorporates more industries in both the upstream and downstream of mining.

While in recent years our mining industry has been challenged by the contraction in gold mining, the mining of other commodities has been growing considerably. Measured in terms of production, sectors such as coal, manganese and chrome have grown considerably in size since the eighties. Platinum and related metals are in a growth phase, with existing mines and refining capacity being expanded. Interestingly the sales of branded platinum, which is value-added, are rapidly increasing.

Most people are not aware that in 2004, for the first time, processed minerals (Ferro-alloys and aluminium) have overtaken precious metals as the main export earners. This growth reinforces our position on the benefits of beneficiation of minerals.

To conclude, Programme Director, ladies and gentlemen, there are clearly synergies in what South Africa has to offer and the need for greater levels of investment in the mining sector in other African countries. I hope that all the visitors from other Africa countries and our own junior miners will gain from the networking as well as benefit from the opportunities which are created by bringing together so many players in the sector. Importantly, we need to see beyond mining activities and look at the possibilities created by value addition.

Finally, I would like to congratulate the organisers of the Mining Indaba for arranging what looks to be a successful conference.

I thank you.

Issued by: Department of Minerals and Energy
7 February 2006
   

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