Zuma says land, mining reform priority, but few details

Land ownership and mining sector reform will be the South African government’s top priorities in 2013, President Jacob Zuma said Monday after a meeting of the ruling African National Congress (ANC) leadership.

Zuma gave few details about the plans in an interview with television channel CNBC Africa, amid criticism over his government’s dismal track record at tackling inequality.

The plans would see the ANC walk a tightrope to woo an impoverished electorate ahead of general elections next year without scaring off investors.

But the party has chosen perhaps the two most contentious issues in Africa’s largest economy for their government programme.

“I don’t think it’s correct to make huge profits and not contribute to the country,” Zuma said of the country’s key mining industry in his interview with CNBC Africa.

“You must know you are dealing with a problem that will one day explode,” he said, referring to violent strike-related unrest at mines last year which killed over 50 people.

Though the ruling party has abandoned talks to nationalise mines, authorities will still intervene in the sector through a state mining company and by raising taxes, he said.

Companies that threatened to close down mines were blackmailing workers into accepting the status quo, he said.

Harmony Gold last week announced it might close down its Kusasalethu mine permanently over worker “intimidation” of management.

Zuma was reelected ANC leader in December, which virtually guarantees him a second presidential term given the party’s dominance at the polls.

His reelection came despite sluggish growth that saw the country’s credit rating downgraded by major ratings agencies.

Anger over poor service delivery, low wages and 25-percent unemployment has led to increased unrest in recent years, and his government’s lack of plans may diminish support for the ANC in elections.

As the country commemorates 100 years since a white-minority government passed a law that forced black people off the majority of the land, Zuma acknowledged that his government would probably miss a target to redistribute 30 percent of white-owned land to blacks by 2014.

“We have tried the willing-seller willing-buyer” approach to land redistribution, he said. “It has not necessarily solved the problem.”

Zuma did not specify the new strategy to balance out land ownership, but ruled out summary expropriation without compensation — which happened in neighbouring Zimbabwe under President Robert Mugabe.

“We are not going to wake up one day and say, ‘Take that farm and take that one,'” he said.

“I don’t think we’ve got to do something outside of the constitution for now. Within the constitution there are remedies.”