The current discourse of Nationalisation that emanates from the ANC alliance partners has been misunderstood by both its proponents and opponents. The proponents of nationalisation raise the issue from a policy perspective of the Kliptown Charter and what they call the Polokwane resolutions. What these proponents seem to forget is how the National Question was resolved at Kempton Park.
The Kempton Park Settlement was and remains a flawed settlement because it was based on the interpretation of the National Question not as that of settler colonialism or a colonialism of a special type. It conflated the struggle for national self-determination and independence to that of democratisation. Having reduced the National Question to that of democratisation, serious compromises were made on fundamental issues of the land and by extension the property clauses that guaranteed the retention of ill gotten gains by the white minority and rendered the question of nationalisation as a mere restitution case based on willing buyer and willing seller. In short the Kliptown Charter vision of Nationalisation was thrown out of the window at Kempton Park. Thus leaving control of mining and land in the hands of the white minority, with very little room to make necessary and required radical changes. That is why Nelson Mandela and the ANC leadership have been saying Nationalisation is out of question. They understand the compromises made at Kempton Park exclude the question of Nationalisation. Whether it is understood or was never explained to the ANC members and Alliance partners it is another matter.
The ANC Government recognising the short comings of Kempton Park had to find a way to redress the situation using the minimalist approach contained in the constitution. Some of those who are surprised by the position of the ANC leadership on nationalisation have no grasp of the Kempton Settlement. The Kliptown Charter was premised on the ANC’s understanding of the National Question pre-CODESA. An analysis and understanding of the National Question post 1994 is required as certain dynamics of the South African society have shifted.
The approach on mineral rights was the use of a raft of legislative instruments including licensing and the Mining Charter that have resulted in the mushrooming of the BEE mining brigade and the sterile debate of Broad Based Black Economic Empowerment when realisation dawned that a few individuals have become super rich as a result of these policies. What in fact the government policies on mining and banking were addressing was the question of deracialising capitalism. This is the same response proposed by Anglo American of creating a black middle class that should have a stake in the maintenance and perpetuation of the capitalist property relations on which the South African political settlement is premised and guaranteed by the Constitution.
On the other hand, with the realisation by the Unions and some elements of the left of the realities of the nature and character of the settlement, a proposal was put on the table for a State Mining Company that would go into joint ventures with mining houses and force transfer of technology and skills to the disadvantaged African masses. This proposal is different from nationalisation but far better than the current existing dispensation, as it brings the state not only as a regulator but a key player in the exploitation of mineral resources of our country without tinkering with the Constitution. At the same time this debate has been distorted by those who have benefited from the ill gotten gains and the BEE brigade for their selfish interests.
Evidence and analysis exists in Europe, Middle East, Asia and in Africa of state companies involved in the exploration and extraction of mineral resources with the state deriving resources for the fiscus. In fact all the oil producing countries have state oil companies that have joint ventures with oil majors and the skies have not fallen.
In Africa we have the example of Nigeria’s NNPC in 51% joint venture with European oil majors, the same as in Angola where SONANGOL has joint ventures with oil majors and mining companies. In the same breath, Botswana has a joint venture with De Beers. In Europe, Norway owns Statoil, an oil company with Russia having State oil companies. This goes for China with massive state oil and mineral companies that are hunting for opportunities throughout the African continent. India has the same State oil companies and mining companies that are bidding in Nigeria and other parts of Africa. The developments in Latin America were expected to come as US influence has waned. The approach in Latin America was crude as a result of American arrogantacracy (a term coined by Chenjarai Hove) with respect to Latin America for years.
Britain owned mines before the Thatcher era. Germany and former Eastern European countries still own coal and iron ore companies. What this shows is that South Africa remains an anomaly as a developing country without a state mining company.
The opponents of a state mining company are agents serving foreign interests where Britain will continue to act as an intermediary to sell South African minerals to the East and other European countries and continue to undermine the mineral beneficiation process of the country that would create value and jobs. COSATU and NUM have to be commended for raising the issue. 70% of the SA platinum that goes to Johnson and Mathee in London goes to the East and so are the diamonds. The steel we send to Germany is treated to withstand heat and exported to the East and back to South Africa at higher cost.
A red herring that has been normally thrown and is rearing its ugly head is that state owned enterprises are poorly run and corrupt. One will not argue the correctness or otherwise of this statement. What one would point out is that with the exception of the US, all European countries including South Africa had to build infrastructure that would support industrial development as the private sector did not have the resources to do so at the time and for these state owned companies, the initial objective was not profit but development. With the development of technology and achievement of industrial development, the Europeans could afford to privatise some of the state owned enterprise while retaining some for national security and strategic purposes. These same countries that hold major stakes in the IMF and the World Bank have the nerve to tell developing countries to privatise national assets. African state owned enterprises will continue to require support from the fiscus as long as the level of development requires. These include airlines, railways and utilities.
The Europeans only privatised once they achieved development and at the back of a welfare state. As long as the issue of access to basic services remains; the state needs to be involved and as long as profitability of airlines is not feasible state support will remain a necessity. This does not mean that incompetence and corruption should be tolerated. If a private company is poorly run you fire management not shareholders and why should it be different to State Owned Enterprises?
Given the limitations of the Kempton Park Settlement, a state mining company is the best option for now rather than the debate on BEE which is mired in corruption and cronyism. The colonial relationships relating to the exploration and extraction of our mineral resources should not be allowed to continue under whatever guise.
The structure and financial model of such an entity must be informed by the national strategic objectives, the needs of communities where mining takes place and sustainability of the mining towns after the minerals are exhausted. The experience of mining towns that have been left as ghost towns once the mining activities cease has to be taken into account to avoid the repetition of Welkom and Kimberly syndrome. This goes for the resolution of the land question that requires a credible solution that is not premised on willing buyer and willing seller.
By Cunningham Ngcukana