Indaba reflects state of SA mining industry

While the Investing in Africa Mining Indaba 2014 was well managed, it was not as well attended as the 2013 indaba, notes offshore law firm Ogier, adding that most indaba exhibitors were service providers and not major mining companies.

“The mood was subdued and there was no sense of deals being made, except in a small minority of cases,” says Ogier group partner Simon Dinning.

Nevertheless, the company maintains that the indaba still offered a unique opportunity for mining companies to connect with companies, lawyers and accountants who have an active interest in the resources industry.

“From our perspective, especially now that our competitors have established an interest in the indaba, attendance is essential, as it enables companies to refresh connections and meet new people in the industry,” says Dinning. 

South African Mining

Dinning says that the South African mining space has stalled, owing to regulatory complications, exchange control and delay in obtaining necessary approvals.

“While Mineral Resources Minister Susan Shabangu described a brighter future that would involve mining licences being available in 300 days during her keynote address, there was an extraordinary amount of scepticism at the indaba about whether that was achievable.”

Moreover, Dinning adds that the mining industry continues to be overshadowed by labour disputes, of which the outside world is aware.  “Coupled with the inability of mining juniors to raise funds, this makes the landscape look fairly bleak.”

He notes, however, that private equity players are showing increased interest in the mining sector, especially in Africa. “The continent still holds several opportunities in the resources and other sectors, including infrastructure, telecommunications and pharmaceuticals.”

Dinning says there was little to be positive about following discussions on the state of mining in South Africa at the indaba. “However, if the Minister is able to direct a concerted effort around licensing and approvals, this will make a material difference to the mining sector,” he adds.

Meanwhile, he stresses that the indaba provides a good opportunity for mining industry stakeholders to deal with the various issues facing the mining industry, such as the lack of available funding.

“Ogier will definitely attend the indaba again, as it is a key event on the mining industry’s calendar and a great opportunity for us to meet clients from around the world.

“In addition to updating existing contracts, we met dozens of potential clients and will now aim to develop new working relationships,” says Dinning.