South Africa mines minister reassures foreign investors

Reuters News
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Posted: Aug 29, 2012 1:58 AM
South Africa mines minister reassures foreign investors

PERTH (Reuters) - South Africa's institutions provide protection for foreign investors in the resources sector, its mining minister said on Wednesday, seeking to reassure about the stability of the sector after a recent wave of labor unrest and deadly violence.

Minister Susan Shabangu made the comment on a trip to Australia after clashes between workers and police killed 44 people earlier this month and shut ore output at mines run by Lonmin, the world's third-largest producer of platinum.

"We urge our investors, incumbent and prospective, to take comfort in the solid foundation set by our constitution, government, legal and civil institutions," Shabangu told a gathering of mining executives and African officials in Perth.

"The president and people of South Africa are determined to isolate bad elements in our society that are seemingly committed to undermine the democratic gains of the country to date," she added.

Platinum miner Lonmin said on Tuesday only 8 percent of workers had reported for duty at its South African operations as it struggles to restart shafts halted for over two weeks.

Minister Shabangu also said the question of nationalization in South Africa's mining sector would be put to bed at the end of the year.

South Africa's ruling African National Congress (ANC) had been expected to rule on a drive to nationalize the country's mines earlier this year.

But the policy still remains unclear although "blanket nationalization" - a sweeping buyout that would cost the state $132 billion - and a windfall tax appear to be off the table.

"That debate will reach its conclusions within the ruling party in 2012," Shabangu said. (Reporting by Rebekah Kebede; Editing by Ed Davies)