Policy implications of the nationalisation of mines in South Africa : a comparative study

Abstract

The proposal to nationalise mines is a contentious issue in South Africa. There are those who argue for, while others against, the proposal. Furthermore, the role of government in this process is relatively unclear. The study investigates the proposed nationalisation of mines and probable policy implications for South Africa. The study is aimed at establishing whether the nationalisation of mines is worth pursuing or not, given South Africa’s current political and economic landscape. The study also investigates nationalisation from an international perspective and provides an overview of countries where mineral and petroleum resources were successfully nationalised. Moreover, these countries are compared to the South African scenario. The study also analyses Alexkor, AEMFC, Eskom, SAA and the SABC and draws a relationship between the management of SOE’s and the probable administration of nationalised mines. A qualitative approach was adopted for this study. Case studies were utilised to address the objectives of the study. This research approach was relevant for this study because it sought responses to the question of whether South Africa can carry out the nationalisation of mines, given its current track record of the mines and the 5 SOE’s. The study seeks examples of countries that have successfully executed the nationalisation of mineral and petroleum resources. Through the analysis of these cases, recommendations are made in terms of how South Africa may approach the nationalisation of mines in order for it to succeed. 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 instances of failure. Moreover, the study focused on the role of public administration, in the implementation of the nationalisation of mines. The study revealed that the successful implementation of nationalisation requires the state to take a lead role in the facilitation of the regulatory environment. Furthermore, the study also revealed that the success of nationalisation is dependent on the relationship between the government and private investors. Negotiations in terms of the control of mineral and petroleum resources in some countries have contributed towards the success of nationalisation.