Aug. 7 (Bloomberg) -- Business leaders must bear part of the blame for a call to nationalize South Africa’s mines, the deputy chairman of the National Planning Commission said.
“The mining companies got together with the ministry and agreed on a transformation charter,” Cyril Ramaphosa, said in an address at the Gordon Institute of Business Science in Johannesburg, which was broadcast on the polity.org.za website. “Nearly all of them have not lived up to that transformation agenda. They planted seeds of dissension for the future. It is only now that the mining industry is waking up and saying: ‘Wow, maybe we should have done certain things to forestall this’.”
Calls for the government to seize mines, banks and land are being made by the ruling African National Congress’ youth wing, which says the country’s black majority still doesn’t have an adequate stake in Africa’s largest economy 17 years after the end of white-minority rule. The ANC agreed in November to an independent study of whether nationalization is viable and to debate the findings next year.
The nationalization drive stems from “a measure of deep frustration by young people, who are unemployed,” said Ramaphosa. “They see these big corporations raking in a lot of money, and they also see that these corporations are not transforming in the way that was agreed.”
A lawyer and former labor-union leader, Ramaphosa is a member of the ANC’s national executive committee. He is also the chairman of MTN Group Ltd., Africa’s largest mobile-phone operator, and co-chairman of Mondi Plc, Europe’s largest maker of office paper. His family trust is the largest shareholder in the Shanduka Group, which has interests in mining, financial services, property and energy businesses.
“There are very sound arguments against nationalization as an effective means to achieve sustainable growth and redistribution of wealth,” Ramaphosa wrote in a column published in Johannesburg’s Sunday Times newspaper today. “In fact, nationalization has the potential to have precisely the opposite effect. We should learn from many countries that have tried this option and failed.”
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