Introduction

South Africa is one of the world’s leading mining and mineral-processing nations. The country has the world’s biggest reserves of platinum-group metals (PGMs) and manganese, and is ranked among the top three countries for chromium, fluorspar, gold, vermiculite and zirconium reserves (Minerals Council, 2021a).

For many years, mining has been the mainstay of the South African economy and the industry continues to be a valuable contributor. In 2020, mining added 8.40%, or R371.90-billion in nominal terms, to gross domestic product (GDP). Mining also provides the single greatest part of South Africa’s export revenues and employs directly, and indirectly, more people than any other comparable sector. The industry in 2020 provided direct employment to more than 452 000 people, which is 4.70% of the total formal nonagricultural employment (Minerals Council, 2021a).

As a major exporter that competes with international players, South Africa must be competitive if it is to realise the true potential of its rich resource endowment. However, regulatory uncertainty, unreliable power supply, high electricity tariffs and rail and logistical shortcomings continue to negatively affect the sector, holding back investment and limiting its contribution to economic growth and development.

This report by the Inclusive Society Institute (ISI) is a summary of themes that emerged from virtual discussions, held in November 2021, with participants from the mining industry to gather their views on what South Africa must do to remove constraints to economic growth and development. The report also puts forward suggestions on what can be done to accelerate GDP growth.

The report is one in a series of ISI reports, which forms part of a broader research project to develop a New Economic Blueprint for South Africa. Discussions were also held with other sectors, including finance, manufacturing, construction, information communication and technology, and retail to canvass their opinions as part of the broader research project.

Unless South Africa achieves much higher levels of economic growth for a sustained period, the country’s economic and social problems of poverty, inequality and unemployment will not be resolved.