19th May 2022 – The mining industry remains integral to fast-tracking South Africa’s economic growth and transformation. This was one of the key outcomes among others to emerge from the Africa Mining Indaba held in Cape Town last week.
Contrary to perceptions that mining is a sunset industry, prospects are encouraging especially as the industry transitions to a new era, says TP Nchocho, CEO of the Industrial Development Corporation (IDC).
“The industry has begun to embrace environmental, social and governance (ESG) commitments. This is encouraging because the future of mining includes an increased focus on the adoption of decarbonisation strategies that will help mining entities to focus on renewables as an alternative to fossils. For the IDC, this transition provides the country with a great opportunity to transform the economy and create more employment opportunities.”
Nchocho says that enabling a competitive mining industry which is climate-resilient requires public-private sector coordination along with a common commodity exploration, production and beneficiation strategy; cheap finance; access to reliable, affordable clean energy; and a conducive policy environment.
It’s encouraging that these discussions dominated interactions, which is why Nchocho was quick to remind stakeholders to follow through on outcomes and resolutions arising from the Indaba.
Of particular significance, President Ramaphosa provided a clear role for government in the sector committing that government would provide an enabling regulatory framework that will boost the industry’s fortunes.
In a boost to mining entities and to SA’s adoption of renewables, three leading South African development finance institutions announced the establishment of a collaborative platform that will support the financing of the country’s Just Energy Transition to a low-carbon economy and a climate-resilient society by 2050. These include: the IDC, the Development Bank of Southern Africa (DBSA) and the National Empowerment Fund (NEF). The IDC’s current exposure to renewable energy stands at over R15.4 billion.
To which Nchocho commented: “This gave us a platform to communicate our commitment to funding entities that want to play a role in SA’s transition to a Just Economy. There is also a growing demand for certain minerals arising out of decarbonisation of our economy.”
Given Africa’s mineral resources endowment, decarbonisation also presents an opportunity for the continent to accelerate growth of its industrial and infrastructure base.