I am not going into details, as the information is freely available online, but here is a list of state owned enterprises soes and their track record. Nationalisation in the reasons to nationalise south. The rest of africa is introducing policy from nationalisation through taxation amendments, all of which require mines. The impact of the proposed nationalisation of south african mines on employment in the platinum sector ii abstract many forums have been recently organised in south africa to discuss the level of state intervention in the minerals sector, the expropriation of private mining companies, and the transfer of mineral wealth to the people. Mine nationalisation will be disastrous for south africas. Nationalisation is the converse of privatisation there is a religion or cult that says that the answer is always to privatise the logic is people are more careful of their own money which sounds logi. The minister of finance mr pravin gordhan stated on march 14, 2011, that nationalisation of south africa s mines and other economic assets is not government policy.
What would it mean for south africa to nationalise the mines. Nationalisation in south africa a debate that will. How privatisation versus nationalisation debate is on a. The advantages and disadvantages of nationalising the zambia. The beneficiation strategy of south africa was not informed by this form of classification of sectors but merely by availability of minerals in south africa. Nationalization of south african mines would represent a read more. Oligopolistic industries are good targets for nationalisation. He refers to an opinion piece nationalization and mining. Nationalisation has many other economic benefits, including the safeguarding of south africas economic sovereignty and shedding the colonial legacy of being an exporter of natural resources and an importer of finished goods and services.
Speaking to fin24 by telephone on friday, associate professor. Binq mining mining equipment advantages and disadvantages of privatisation and nationalisation in south african mines. Truth and fiction in the investment analysts society of south africa. Apr 20, 2012 nationalisation to industrialise and create more jobs. A storm erupted in policy circles in south africa after julius malema the leader of the african national congress youth league ancyl boldly proclaimed the need for the mining industry in south africa to be nationalized. Sep 28, 2012 he refers to an opinion piece nationalization and mining.
This paper considers the case for nationalizing the local mining sector from an evidencebased perspective, which is derived from theoretical. Partnerships in namibia and botswanna between mining companies. Oct 27, 20 these people solely believe in the failed capitalist system that states that the markets should be the sole determinants of the direction of south africas economy. It could lead to better financial security for south africa.
Advantages of nationalisation currently in the postapartheid era, south africa hasnt achieved. Dec 15, 2019 arguments for nationalisation include. The study analysed and investigated the debate of nationalisation in south africa by exploring its advantages and disadvantages to perspectives drawn from countries where nationalisation was successful, including. The np in south africa regularly used nationalisation as a policy, as part of an isi project, both in its first term in office as part the 1924 pact government, and then again from 1948. The demand was predicated on fulfilling the vision of the freedom charter, which was adopted at kliptown in 1955 as the manifesto of the liberation struggle. The pros and cons of south africa nationalizing its mines. How privatisation versus nationalisation debate is on a fast. Eskom bailouts, mismanagement, corruption, nepotism. In south africa, these measures are closely tied to the ancs historic agenda of fostering a prosperous noneuropean bourgeois class. Anc study rejects nationalization of south africa mines, feb 02, 2012 a report by south africas ruling african national congress found that the nationalization of mines, as proposed by julius malema, head of the partys.
Advantages and disadvantages of nationalisation connectus. Dec 18, 2012 south africa s government says it has ruled out wholesale nationalisation of the mining industry. How privatisation versus nationalisation debate is on a fast track to nowhere people want more than what is on offer with the now stale, mostly elitist and selfconstructed choice between. For one, economically speaking, it ensures that a government can stay homogenized and the economy toptobottom can be nationalized. By 1986 a noticeable decline in copper production resulted in the closure of many mining units and led to the implementation of a fiveyear plan to revive the company8. A sector that is nationalised, allows the government to have direct control over that sector. Nationalisation to transform south africas unequal spatial development pattern. Report on nationalisation of mines nationalisation of mines in south africa hasnt achieved much advantages of more detailed. Privatisation is the fundamental policy of the anc and it will be implemented. Nov 19, 2009 currently, south africas government claims that it has no plans to nationalize its mining industry. Nationalization is the act of taking assets into state ownership. While threats of nationalisation loom large, reserve bank could keep same governor the eff wants the reserve bank nationalised but will lesetja kganyago get another term.
Disguising itself behind the nationalisation of mines call and funding itself the nationalisation of mines debate in south africa is, as predicted, reaching new there is no conceivable advantage and an almost endless and therefore a partial withdrawal from the. Ups and downs in mining oxford business group jul 27, 2011 while south africas mining sector is currently benefitting to look at the pros and cons of nationalisation with delegates to undertake studi 247 online. Policy implications of the nationalisation of mines. Policy implications of the nationalisation of mines in. Nationalisation of the mines in south africa economics essay. Advantages and disadvantages of nationalising mines uk essays. How do natural disasters affect formal and informal businesses. South africas mines minister susan shabangu has emphasized the importance of foreign investment in south africa, a significant part of which is vested in the mining industry. Advantages and problems of privatisation economics help. Nationalisation of mines in south africa essay 34 words. Nationalisation as a means to safeguard sovereignty. Indeed, each element of privatizationfrom its apparent costsaving properties to its possible negative impact on. Nationalisation of mines, banks and strategic sectors of our economy as stated as one of the 7 nonnegotiable pillars of the eff remains more relevant now than ever before.
There are a number of reasons for state involvement in commercial enterprises. From nationalisation to privatisation in south africa nationalisation of the mines, banks and monopoly industries is the policy of the anc and a change or modification of our views in this regard is inconceivable. Should mines and banks in south africa be nationalised. The deputy president of south africa kgalema motlanthe has told the bbc that the country will not be adopting a policy of nationalisation of mines. Nationalisation of mines in south africa 3122 words. Nationalisation and the perceived consequences for a gold mine. Disadvantages of nationalising mining sector south africa. What are the advantages and disadvantages of nationalization.
It is quite evident that the state has not got the necessary capital, skill and support to control the mines in south africa. The skilled and efficient businessmen are replaced after nationalization. In south africa, the amended mining charter outlines the expectations of rights holders to invest in the social reformation of the industry, including new elements, ringfencing of certain elements and a revised scorecard. The future of mining in africa navigating a revolution. Disadvantages of nationalization or arguments against. Nationalisation of mines is synonymous with a shammedia the debate on the nationalisation of mines has gained intense attention from all such qualifies the call for nationalisation of mines in south africa as there are japan predicted for china would not have been resolved through privatisation. So government may not be in position to initiate new schemes freely. Nationalization doesnt have to cut out the private sector completely. Advantages and disadvantages of privatization the merits and drawbacks of privatization have been subjects of considerable debate among businesspeople, city leaders, and public employees alike.
Privatisation in south africa and africa free market foundation. Advantages and disadvantages of nationalising mines. Under the union of south africa beginning in 1910, the british and the afrikaners ruled together. Privatisation involves selling stateowned assets to the private sector. The impact of the proposed nationalisation of south african. Mar 19, 20 see the zabalaza pamphlet fighting privatisation in south africa and south africa. Most of the uks major strategic heavy industries and public utilities were nationalised between 1946 and the early 1950s, only to be returned to the private sector between 1979 and 1990 examples of nationalisation. In nationalising the mining sector in south africa, the state government believes it would have the capabilities of attracting labourintensive mining industrialists who will process mineral resources and diversify the south african economy. An enonomic assessment article pdf available in journal south african institute of mining and metallurgy 11. Advantages of nationalisation include greater income and distribution of wealth to members of society. Currently south africa is one of the most unequal societies in the world and nationalisation will bridge the gap between rich and poor.
Nov 19, 2019 a look at the arguments for and against privatisation. If the mining sector is nationalised, this would entice the government to sell more minerals within the south african borders rather than export these minerals to. Johannesburg there are certain entities of the economy which are supposed to be democratically owned by all people and the reserve bank, which is the apex of the financial system, should be one of them, according to an analyst. When it comes to nationalisation, there are plenty of advantages. Pdf nationalization is high on the policy agenda in south africa. Most of the uks major strategic heavy industries and public utilities were nationalised between 1946 and the early 1950s, only to be returned to the private sector between 1979 and 1990. Apartheid is defined as the development of separate races. South africas government says it has ruled out wholesale nationalisation of the mining industry. It is argued the private sector tends to run a business more efficiently because of the profit motive. Nationalising south african mines stellenbosch university. Nationalisation to transform south africa s unequal spatial development pattern.
Many key industries nationalised were natural monopolies. The charge usually taken over by the officials who are incompetent and inexperienced to run the industries. This amount does not include nonlisted companies however. These people solely believe in the failed capitalist system that states that the markets should be the sole determinants of the direction of south africas economy. State industries like south africas eskom show working class deserves better. In order implement the nationalisation of mines, it would cost south africa r1.
This is because fixed costs are so high in creating a network of water pipes, there is no sense in having any competition. This is especially true in light of his most recent talkleft walkright statements concerning nationalisation of mines, south africa is one of the worlds most. This paper considers the case for nationalizing the local mining sector from. According to economic theory, benefits must be greater than the costs to be financially successful. Nationalization in southern africa was justified on. Nationalizing the mines could, in the short term, make south africans better off on the whole. The impact of the proposed nationalisation of south. Ups and downs in mining oxford business group jul 27, 2011 while south africa s mining sector is currently benefitting to look at the pros and cons of nationalisation with delegates to undertake studi 247 online.
This means the most efficient number of firms in the industry is one. Economic development and the role of the state the transformation of modern society by what. Why sa needs nationalisation by effled government economic. The proposal to nationalise the south african mining industry has provoked heated and often. The new south african debate on nationalisation versus privati sation seems to be dominated tatives of the national union of mine workers num were very. Africas experience of nationalization, at the national african federated chamber of commerce. It could help boost south africa s other industries. The national party, after being voted into power in 1948, began a policy of apartheid. What would happen to sa if mines were nationalised. Is the nationalisation of the south african mining industry a good. Nationalisation to industrialise and create more jobs. If the mining sector is nationalised, this would entice the government to sell more minerals within the south african borders rather than export these minerals to foreign countries. The minister of finance mr pravin gordhan stated on march 14, 2011, that nationalisation of south africas mines and other economic assets is not government policy.
Nationalisation in the reasons to nationalise south africa. Mine nationalisation will be disastrous for south africas economy. Alternative needed to nationalisation and privatisation. Dec 20, 2012 nationalisation of mines dead and buried. Nationalisation of mines is synonymous with a shammedia. Nationalisation as a means to accumulation path in the south african economy. Public generally criticizes the giant policy of nationalization. Lessons from zambia daniel limpitla wrote about a year ago, saying it is most relevant because whilst the debate around nationalisation of the mining sector in south africa is not front and centre of the conversation, it is always trending beneath the surface. President jacob zuma has promised there will be greater state intervention and possibly strategic. Stats sa statistics south africa nationalizing south african mines. Disadvantages of nationalisation of mines in south africa advantages and disadvantages of nationalization mining sector, south africa will not nationalise its mines, says minister susan,anglo is the largest private sector employer in south africa, with the mining sector making up. Disadvantages of nationalisation in the mining industry in sa. The nationalisation of mines in south africa is a costly, highrisk proposition that should be adopted only as a last resort, an independent panel of experts is reported to have concluded after a. The debate on the nationalisation of mines has gained intense attention from all such qualifies the call for nationalisation of mines in south africa as there are japan predicted for china would not have been resolved through privatisation.