Department of Economic Development GAUTENG MINERAL BENEFICIATION STRATEGY SAPSDA Networking/Members meeting
Contents 1. Introduction 2. Problem Statement 3. Rationale 4. Strategic Objectives 5. Legislations 6. Gauteng Strategic Commodities 7. Key Intervention
Introduction • South Africa's economic growth has been and will continue to be closely linked to the mining industry. The country is one of the world's most important mining countries in terms of the variety and quantity of minerals produced • South Africa has the world's largest reserves of Platinum Group Minerals (PGM's), chrome, gold, vanadium and manganese • Our province inherited the name Gauteng because of the mining activities that were taking place within the province. • Gold was once the pillar of the economy of South Africa in the 1980s since it contributed about 15% of the national GDP. 3
SOUTH AFRICA’S COMPARATIVE ADVANTAGE South Africa’s Comparative Advantage Mineral reserve (2013) • South Africa has the world’s largest resources of platinum group metals ( 88% of world total ) • Manganese ( 80%) • Chromium (72%) • Gold (30%), In-Situ value conservatively estimated at US$ 2.5 Trillion, excluding energy commodities (coal, uranium, thorium)
Gauteng Mineral Deposits 5
Problem Statement • South Africa is one of the world’s largest exporters of platinum group metals, coal, gold and vanadium, and a significant exporter of manganese ore with v limited local beneficiation . 6
Rationale Mining and minerals products contribute 38.18% of our exports (September 2015) and the industry employs 490 000 workers (June 205). 1. This could be much higher if our raw materials were processed into intermediate and finished products before export. 2. Strengthen the mining industry by building manufacturing corridors.
Strategic Objectives • Transformation of the Economy: transforming the industry by moving away from export of raw material to export finished goods • Modernisation: Support the Use Morden technologies to improve process efficiencies from mining to manufacturing • Re – Industrialization: Support the upgrading and value addition of South Africa’s minerals, by encouraging local manufacturing and production. • Environmental and Health Management: Support the development of technologies to minimise the impact from mining activities on its workforce • Skills Development: skills development personnel in the industry to improve efficiency. 8
Policy and Legislations Supporting legislation, long term strategies and initiatives for beneficiation include the following: • National Development Plan( NDP) • National Beneficiation Strategy • New Growth Path (NGP) • Industrial Policy Action Plan (IPAP) • Gauteng City region • Mineral and Petroleum Resources Development Act (MPRDA) • Broad Based Socio-Economic Empowerment (BBSEE) charter • Precious Metals Act No. 37 of 2005 • Diamonds Amendment Act No. 29 of 2005 • South African Diamond and Precious Metals Regulator 9
Gauteng Strategic Commodities • PGMs • Gold • Iron ore • Coal 10
PGM Activity Chain Source: Anglo American 11
Platinum Production and Beneficiation Source: DTI 12
Input-Output Structure of the Gold Jewellery Value Chain Source: World Gold council 13
Rank Country/Region Gold production (tonnes) World 2,700 1 China 370 2 Australia 250 3 United States 230 4 Russia 205 5 South Africa 170 6 Peru 165 7 Canada 102 8 Indonesia 95 9 Uzbekistan 90 10 Ghana 89 11 Mexico 87 Rest of the world 845 14 Source: U.S. Geological Survey
Top 20 Exporters of gold Jewellery, 15
The Iron Ore, Steel and Steel Products Value Chain 16 Source : Kumba Iron ore
Challenges Affecting the industry • Rapidly Rising Input Cost (e.g energy) • Labour Productivity • Research and Development Investment • Compliance with Environmental Regulations • High Transport and Logistics Costs • Limited Access to Capital (industrial finance, customized industrial inventive) • Unfavourable global trade (trade tariffs, heavily subsidized products 17
• 18
• Create engagement platform • Forge strategic partnerships • Mobilise resources for local beneficiation • Align government and industry initiatives • Coherent mineral beneficiation strategy 19
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