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Address by Youth League President Julius Malema at the Mining for Change Conference

7 September 2010, Sandton Convention Centre

The ANC Youth League is honoured to address the Mining for Change Conference, which has brought together various stakeholders and role players in Mining, to discuss how best South Africa benefits from the country Mineral resources and the mining sector in general.

This forum is important because credible and evidence based information and data is brought and in most instances confirming what the ANC Youth League has always said, particularly that 1) the people of South Africa have not substantially benefitted from the country`s mineral resources and 2) that South Africa remains the most lucrative mining territory in the entire world.

Most of you here might be aware of the research report released in April this year, by the American banking Group, Citigroup, which said that South Africa is the richest in the world when it comes to mineral reserves.

We are indeed the richest country in the world when it comes to mineral resources because we are home to 70% of the world`s platinum group metals, more than 70% of chrome, manganese, iron ore and many other critical precious and industrial metals.

Our massive minerals wealth and resources` however co-exist with high levels of poverty, unemployment and starvation of particularly the black majority and Africans in particular.

While the economy grew over the last 16 years, not so many jobs were created to redeem majority of our people from absolute poverty.

The ANC government`s efforts to make sure that people have better and sustainable livelihoods have not succeeded because we have not changed the structure of South Africa`s economy.

We have dedicated much time and efforts trying to deal with issues of service delivery within a very limited fiscus, but have not moved decisively to transform the economy.

The model of empowerment we adopted, in particular BEE has not succeeded in empowering majority of our people. Instead, few and politically connected individuals are the ones who have reaped the fruits of Black Economic Empowerment.

When we went to Polokwane, the question of few people benefiting from BEE deals was one of the issues we raised and one of the issues that led to the removal of the leadership that wanted to control and own the ANC forever.

If reports that such trends is repeating itself under the new administration are true, then we will again have a bigger problem, because our people are getting more impatient with slower and lack of economic emancipation and freedom.

The ANC has a strategic objective and vision on how it can best resolve these challenges of high levels of poverty, unemployment and starvation.

That vision and strategic objective is the FREEDOM CHARTER.

The Freedom Charter says that under the democratic government, the minerals wealth beneath the soil, monopoly industries and banks shall be transferred to the ownership of the people as a whole.

This Freedom Charter was re-affirmed in all ANC Conferences, including the 2007 52nd National Conference of the ANC in Polokwane, which said ANC`s view on economic transformation takes as its starting point, the Freedom Charter`s clarion call that the people shall share in the country`s wealth.

We have been listening to leaders of the ANC who have been saying nationalisation is not the policy of the ANC. It is the policy of the ANC and we want to reactivate it so it becomes policy of the government

A debate on whether to nationalise or not does not arise in the ANC, because all of us, who have joined the ANC, joined in order to realise the aims and objectives of the Freedom Charter, which amongst other things say Mines should be nationalised.

If you say it is not the policy of the ANC... You are denouncing the Freedom Charter... Everyone else junior and senior must respect the policies of the ANC.

Those in the ANC, who oppose Nationalisation of Mines, are in actual fact opposing what Nelson Mandela, Walter Sisulu, Govan Mbeki and many others were imprisoned for. Thos who oppose Mines nationalisation in the ANC are opposing what O.R. Tambo, Robert Resha, Patrick Maoloa were exiled for. They are opposing what Chris Hani was killed for. Chris Hani was killed because he was not ready to sacrifice the Freedom Charter, and we will never betray him.

The ANC Youth League 1st National General Council, which happened between the 24th and 27th of August here in Johannesburg, took a very clear resolution on Nationalisation of Mines and how it is going to benefit all the people.

We re-affirmed our standing that Mines` Nationalisation should happen in order to achieve the following:

a. Increase the budget of the State for social development purposes, e.g. Health, Education, Rural development, fight against crime and job creation.
b. Lay a very firm basis for the country`s minerals to be locally beneficiated and industrialised.  
c. Change the South African economy from over-dependence and reliance of exporting of natural resources and importing of finished goods and services.
d. Create new economic centres of development outside of Johannesburg, Durban and Cape Town.
e. Could improve the working conditions and salaries of Mine workers.

The government revenue that is generated from taxes will not be able to build better lives for all South Africans. Government cannot solely rely on taxes to deliver better services to majority of our people. South African will not be able to deal with the housing backlog, free education access, better healthcare, safety and security, employment of particularly youth if we are not in control of the key and strategic sectors of the South African economy. The wealth of South Africa should benefit all who live in it.

It is an open secret that ordinary workers in Mines are the least beneficiaries of mining in South Africa either as recipients of salaries and stakeholders in mining. Mineworkers in South Africa are underpaid and work under difficult conditions and unsafe Mines. Their workplaces and socio-economic existence expose these workers to fatal diseases and accidents. Nationalised Mines should be beacons of safer working environments and better working conditions, as they will not be in narrow pursuit of profits at the expense of community and human development.

With State ownership and control of Mineral Resources, South Africa will be able to attract industrial investors, who will contribute to the growth of the economy, transfer skills, education and expertise to locals and give them sustainable jobs. It can never be correct that an absolute majority of the Minerals we produce is exported to other countries, with very little efforts to build internal capacity to beneficiate these minerals.

Nationalisation of Mines will lead to greater local beneficiation, industrialisation, growth of the economy and jobs for majority of our people. The industrial strategy adopted by government will never succeed unless we have State control and ownership of the natural resources.

We need metals, iron ore, gold, platinum, COAL, chrome, manganese and many other minerals to industrialise. South Africa`s skills development efforts should be dynamically (not exclusively) linked to the industrialisation of minerals wealth.

Although related to the above component, it is important to highlight the fact that the South African economy as it currently stands bears strong features of all colonial economies. Primarily, all colonial economies were positioned as sources and reserves of primary goods and services for the colonisers` economies.

Post political independence, many if not all post colonial economies continued to function and operate in the same manner colonisers designed them-exporters of primary commodities and importers of finished goods and services. This pattern has a direct impact on the sustainability of post colonial economies as they are heavily reliant on the demand of their goods and services by former colonisers and bigger market economies.

Nationalised Mines ought to lead to a Spatial Development Framework that should necessarily decentralise development.

Areas such as Sekhukhune, Rustenburg, Burgersfort, and Emalahleni have far greater economic potential because of the mineral resources underneath the soil. These should be deliberately developed, beneficiated and industrialised to enhance and harness economic and human development in these territories".

Further Benefits of success have already been heighted above, and these will be the additional benefits to Mines Nationalisation:

a. Increased fiscus and therefore more resources for education, housing, healthcare, infrastructure development, safety and security and sustainable livelihoods for our people.
b. More jobs for our people because State owned and controlled Mines will increase local beneficiation and industrialisation of Mineral resources. This will in turn reduce the high levels of poverty, which is consequent of joblessness.
c. More equitable spatial development because State owned and controlled Mines will invest in areas where Mining is happening.
d. Better salaries and working conditions in Mines because State owned Mines will increase the Mining wage and improve compliance to occupational health and safety standards.
e. Greater levels of economic and political sovereignty as the State will be in control and ownership of strategic sectors of the economy, which produces minerals resources needed across the world.

STATE OWNED MINING COMPANY

The State Owned Mining Company should be established and be under the direct supervision of the Department of Mineral Resources (not Public Enterprises) and fundamentally responsible for the following tasks:

a. Own and control South Africa`s mineral resources;
b. Maximise the nation`s economic gain from the mineral resources;
c. Contribute to South Africa`s social and economic development;
d. Develop and maintain strong environmental and safety standards; and
e. Develop the mineral resources in a careful and deliberate manner.
f. Develop strategies for Skills development in the Mining sector, including through establishment of Mining colleges for low, intermediary and high intensive skills development of all people.

The State Owned Mining Company should be established through an ACT of Parliament, which should clearly define its tasks, responsibilities, accountability mechanisms.

The SOMCO should necessarily gather all the State`s interests in Mining including those in Allexkor,  African Exploration Mining & Finance Corporation (AEMFC) and various other Stakes which government holds through Provincial parastatals and shares in bigger mining corporation.

A Minimum of 60% of the Mineral resources extracted by the State Owned Mining Company should be locally beneficiated and industrialized, and 50% of such beneficiation and industrialization of minerals should happen in the Mining Communities.

Strong accountability mechanisms should be instituted to guide how those who work for SOMCO do not redirect its resources into their individuals benefit and progress.

a. Strong Community involvement and National Accountability Forum on the management of the Mining resources. There should be an annual Stakeholders` Mining Conference to discuss the direction and content of the SOMCO activities, including its finances, community development programmes.
b. Those involved in the running of the State Owned Mining Company should be closely monitored and processed for honesty purposes. Assessment of SOMCO should include all employees of the Company.

The State Owned Mining Company will within a broader Minerals Strategy ensure that all the beneficiation and industrialisation of minerals benefits all people.  

Importantly, the State Owned Mining Company should attract the best of skills, expertise and knowledge on how best minerals are extracted, produced, beneficiated and traded for the mineral resources in South Africa.

AMEND THE MINERALS ACT AND NATIONALISE THE MINES

After the State Owned Mining Company is established, the Minerals and Petroleum Resources Development Act will be amended to say that the new Licence terms and conditions say that the State Owned Mining Company should have 60% ownership and control of all profitable Mines.

All Mineral rights will under this new arrangement be transferred to the State Owned Mining Company, which will enter into partnerships on the basis that that State is on control and ownership of all Minerals rights and the private corporations own the shafts and some of the expertise and skills.

The remaining 40% for the Private Corporations should remain complaint to the current Mining Charter requirements and continue to pay taxes and royalties.

Mineral wealth in South Africa will then begin to benefit all the people in the real sense.

When the MPRDA was adopted in 2002, the State informed all private mining corporations that now there is a new law that requires compliance through applying for Licences and that is what should be done after the Act has been amended.

This does not require the State to spend billions buying anything from the big Mining corporations because the State is in total ownership and control of Mineral rights.

The State will then give private corporations a maximum of five years to comply or face expropriation without compensation.

Those who want to leave and disinvest within this period can do so and then the State Owned Mining Company will establish new relations with investors who will comply with the new terms and conditions.

That is the Nationalisation of Mines we are talking about, but it must also have the following features:
 
a. Development of Minerals Strategy which will clearly define the State`s interests and participation in minerals development and mining in South Africa.
b. Passing of an Expropriation Act, which will clearly define the State`s public interest expropriation model and practice with or without compensation,
c. Establishment of a State Bank, which will finance all Mining operations and development projects around the State,
d. Development of a concrete social and labour development model, which will ensure that communities around the Mines are developed out of the proceeds of Mining,
e. Re-alignment of South Africa`s Industrial Policy and action plan around to consider the reality that the State will be in control and ownership of Mines and mineral resources, so as to guide a concrete plan on minerals` beneficiation and industrialisation.
f. Amendment of Section 25 of South Africa`s Constitution to empower the State to expropriate in the public interest with or without compensation.

The essence of these politics will be discussed and consolidated in the ANC National General Council in two weeks time and will squarely fit tour political programme of Economic Freedom in Our Lifetime.

Most of you here have interest in Mining, but are very small role players as compared to the big corporations.

The establishment and development of smaller and Medium Mining corporations should continue, because at a subsequent stage, the State Owned Mining Company will have to partner with South African owned mining corporations.

You must continue to invest in Mining development and mining technology, because those efforts will in the future be needed to benefit the whole of society.

What is relieving about most of you gathered here today is that you are not obsessed with profits and narrow profit maximisation, but understand that your benefiting from mining should also empower the black majority and Africans in particular.

Those who currently own the mining corporations do not have our interests at heart, their only obsession is to make money and leave big holes beneath our soil.

Minerals are non-renewable resources and if we do not do anything to transfer Minerals to the ownership and control of the people as a whole, we will be left with big hole, diseases and dysfunctional communities because we would have been scared to take decisions on how we shape our future for the better.