ANC 'nationalising' by stealth - DA

2010-10-11 17:03

Cape Town - There is little doubt, according to the Democratic Alliance, that the ANC is trying to advance its agenda of nationalisation by stealth.

The party spokesperson on mining, Hendrik Schmidt, pointed out on Monday that a state-owned mining company, the African Exploration Mining and Finance Corporation (AEMFC), which lay dormant for 63 years,  has been re-invigorated, given a new mission in life and now been given mining and prospecting rights.

Mining Minister Susan Shabangu said in a written answer to a parliamentary question that the company had been awarded one mining right and 27 prospecting rights.

Schmidt said: "This is deeply significant.

"It means the government now runs two state-owned mines: the diamond mine Alexkor and now the AEMFC.

"The creation of a mining company that is owned by the state, given its licences by the state (in a seemingly biased and non-transparent process) and then operates on state business, suggests the worst form of cynicism.

"Such practices should have no place in our economy. Given the track-record of state mines, broadly speaking, it should have no place in our country as a whole either."


Schmidt said that the company, like Alexkor, had been running at a substantial financial loss (R14m for 2009/10 and R10m for the previous year).

He noted that according to the AEMFC's annual report, its "principal activity" was to "acquire, hold, exploit, develop and engage in mining

The report said, among other things, the entity's long-term strategy was to "diversify into non strategic mineral resources" (compared to its current mandate, which is to assist Eskom and PetroSA in ensuring a secure supply of feedstock) and to "enter in regional markets (Botswana, Swaziland, Mozambique and Zimbabwe)".

The reply to the parliamentary question "suggests that its transition from an empty shell to a fully second state-owned mine is now near completion," Schmidt said, "and with it, the ANC government's obsession with increasing its control over mining in South Africa."

He added that in the past five years there has been substantial growth in the mining sector in other parts of the world, while South African mines had seen a lack of investment.

"This has partially been a repercussion of this sector of the economy being used as a vehicle to achieve short-sighted, economically misguided, political agendas," he said.

"It seems that what the Act started, the full operation of AEMFC is bringing to completion."