Mine nationalisation S.Africa's 'road to ruin': Anglo chief

8th February 2011, Comments 0 comments

Nationalising South Africa's mines would be the country's path to ruin and would drive away billions of dollars in investments, mining giant Anglo American's chief executive warned on Tuesday.

"Mining companies simply will not invest if they cannot be assured that the assets they create will be secure," Cynthia Carroll told an African mining conference in Cape Town.

"In ignoring this truth the false prophets who argue for nationalisation are advocating the road to ruin, a path we must not follow."

The firebrand leader of South Africa's ruling party youth league, Julius Malema, is pushing to nationalise the country's mines, which produce 88 percent of the world's platinum and 40 percent of its gold.

The government has repeatedly said nationalisation is not its policy, but the ruling African National Congress last year agreed to research the issue amid insistent calls from the outspoken Malema.

The mining industry has called on the government to put an end to uncertainty about nationalisation.

"Mining lead times are long and companies need to be able to plan with confidence 20, 30, 50 years ahead, and the amounts involved are significant with the investments requiring billions of dollars," said Carroll.

London-based Anglo American, which was founded in South Africa, is the country's largest private sector employer and generates between 2.0 and 2.5 percent of South Africa's GDP, she said.

© 2011 AFP

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