Thank you to Andy Higginbottom for this timely and informative report on the current state of the mining industry in South Africa. To learn more about the activities planned for the 11th anniversary of the Marikana Massacre, see our post here.
This study ‘follows the money’, the profits of mining corporations operating in South Africa.
The sector generated at least US$ 15.7bn net operating profits in 2022. Coal, platinum group metals, and diamonds achieved especially high prices and were particularly profitable for their producers.
Foreign based multinationals received around 55% of the profits. Half the profits generated by mining in South Africa pass through to London corporations and capital markets. Anglo American stands out as the major player, taking 41% of sector profits; with Swiss company Glencore benefitting hugely from unusually high coal prices.
Profitable South African companies, Impala Platinum and Sibanye Stillwater, have attracted the interest of the giant US based asset managers such as Blackrock and Vanguard.
Several of the South African based companies have extensive overseas operations, especially in the gold sector.
There is significant black leadership in the sector due to the Black Economic Empowerment (BEE) programme. In practice this has turned out to be ‘legalised corruption’ embedded within corporate governance, i.e. increased ownership for a select few has bought their loyalty to big business, as epitomised by the 9% stake in Lonmin of Cyril Ramaphosa, whose urging of police action led to the Marikana Massacre on 16 August 2012.
However, it is important to recognise that Marikana is one instance of a global pattern of contracted out state violence for profit. Lonmin’s parent company Xstrata (later Glencore), had just three months earlier sponsored similar shootings in Peru.
These results confirm continuity with the international exploitation established by Cecil Rhodes, and intensified during apartheid. As Kwame Nkrumah said, we need positive international action to fight this latest chapter in neocolonialism ‘with resolution and in unity’.