South Africa’s ruling African National Congress will make a final decision on nationalization of mines next week as uncertainty around the issue deters foreign investment, Secretary-General Gwede Mantashe said.
The role of the state in the economy will be among policy issues discussed at a party conference scheduled for Dec. 16-20, Mantashe wrote in an opinion piece today in the Johannesburg- based Sunday Times. The party has commissioned “thorough research” on nationalization and “now the time for a decision has come”, he wrote.
The ANC undertook a study on state intervention in the mining industry after the party’s Youth League lobbied for nationalization to give the black majority a bigger stake in the country’s mineral wealth. The study found that seizures would result in a near collapse of foreign investment and access to finance, increased legal challenges by investors, and be “an unmitigated economic disaster” for the country.
Anglo American Plc (AAL), Xstrata Plc (XTA) and BHP Billiton Ltd. (BHP) own mines in the country.
“Any further uncertainty on this matter will affect our ability to attract more investment,” Mantashe wrote in the article. “While investor sentiment cannot dictate economic policy, uncertainty is not to be encouraged if we are serious about partnering locally and globally to build the economy.”
The ANC will also discuss the effectiveness of policies to increase participation of blacks in the economy, redistribute land and create jobs at the conference, which will elect a new party leadership. The conference will be held in Bloemfontein.
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