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Archive for November, 2015

Depressed commodity prices, the continuing economic downturn and pervasive illegal mining activities, have been hitting South Africa’s mining sector hard. Cost cutting plans, retrenchments and even mine closures are the order of the day.

While stimulating commodity prices and resuscitating the global economy are beyond the South African mining industry’s scope, the sector has no choice but to find a way to deal with illegal mining activities that are carried out without regard to issues of health, safety, and human rights.

Previously illegal mining activities were limited to abandoned mining operations where lax closure controls had enabled informal mining entrepreneurs to eke out a living re-mining old workings. Increasingly illegal mining is now taking place at operational mines with gangs violently fighting back against mine owners attempts to reclaim their legal operations.

Gangs operated by sophisticated syndicates have also reportedly taken to kidnapping informal mine workers underground, holding them captive for weeks at a time and forcing them to work for free. This is slave labour.  It would not be permitted above ground, so why is it allowed to take place below ground?

Combating illegal mining activities head-on is clearly not working as syndicates continue to extend their reach and to professionalise their activities in order to maximise their profits.  In addition, the next round of mine worker retrenchments is only likely to boost the ranks of illegal mining entrepreneurs making a living off South Africa’s mines. If something is not done to transform the current mining sector model, illegal mining will be the final death knell for South Africa’s ailing mining sector.

The formal mining industry needs to have a radical rethink about its current operating structures and find a way to incorporate different levels of mining entrepreneurs within their organisations. Legal opportunities for informal mining entrepreneurs that do not compete with formal mining activities need to be identified and built into the larger formal mining framework. These informal mining entrepreneurs could be supported by the larger mining entity while at the same time acting as a buffer against the spread of illegal mining syndicates that are already prepared to do battle to continue their illegal mining operations.

At present the pattern of illegal mining that is being allowed to persist is creating new chains of corruption that will be difficult to eradicate. These include the recruitment of legal miners to provide support to illegal mining operations by smuggling food and supplies underground or by renting out their access cards, policemen who lie in wait to grab the ill-gotten gains of informal mining entrepreneurs as they emerge into the light from their weeks spent working underground, and mine security officials who are bribed to turn a blind eye to illegal mining activities.

The mining sector needs to fight fire with fire. This requires being innovative in identifying solutions that will empower informal mining entrepreneurs and make them feel that they have a stake in legal mining operations. It won’t be easy, and will require co-operation from the mining companies, trade unions and government, all of whom have competing agendas. However, if compromises aren’t made and solutions identified, South Africa’s mining sector will find itself hijacked.

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