Nationalize the Mining Value-Chain

"Strip coal mining" by Stephen Codrington. Licensed under CC BY 2.5 via Wikimedia Commons -

The policy of nationalization of mines as proposed by the ANC Youth League is long overdue and is to be welcomed while the details thereof is a matter for debate. It should be stated that nationalization of mines should in essence be about nationalization of the whole mining value chain if it is to benefit communities endowed with mineral deposits and the country as a whole.

Core mining activities should be under national command by the state. Thus nationalization of ownership and control of the mines should in all material respects involve exploration, processing, beneficiation and trading, leading to fundamental transformation of the mining sector. Nationalization of the mining value chain and other strategic resources should be geared towards improving scope for employment creation, skills development, generation of resources from profits for development purposes, improvement of workers safety and the general working conditions.

It is important to delineate the scope of nationalization for we may simply transfer mines from the hands of a few capitalists to the hands of a few state elites who will in turn give lucrative contracts to the same few capitalists to add value to mining produce as it happening with operations of most ‘BEE’ companies. We should not nationalize just to open a tendergate. The only way the current owners can continue playing a role is by working for the state mines. Only support and highly specialized services may be outsourced.

The most interesting observation in this debate is the attitude of the South African ‘Communists’ Party. (SACP). It is hard to understand on what ideological grounds these ‘communists’ would muster the courage to oppose a policy that represents transfer of public resources form private and predominately white neocolonial hands to the public unless they are duplicitous.

Instead of enriching this policy debate, as would be expected of ‘communists’ on this matter of strategic national significance, the so called communists are on the contrary deflecting debate to peripheral issues. They charge that the call is “a self serving opportunistic maneuvers to save struggling mining houses or ‘BEE’ companies” or “that the proposal is shallow” instead of pronouncing whether or they support the transfer of mining ownership and control from a tiny white minority to the state on behalf of the African majority. Their attitude has made it clear to all and sundry that they prefer the status quo. To date they have not voiced their support for this progressive policy proposal.

Apart from minerals, the land, water, aquamarine, air space resources and other strategic national resources must be nationalized and exploited to benefit the public rather than a few individuals. The debate about nationalization of mines must therefore be extended beyond mineral deposits.

Hulisani Mmbara
Chief Editor