South Africa : World Focal Point Of Mineral Supply And Investment

INTRODUCTION During the past 40 years, there has been in the United States of America and other industrialised Western countries a distinct displacement in the procurement of minerals from domestic sources towards an increased dependence on imported minerals. This was caused in part by one or each of the following: a lack of local supply of particular minerals, domestic source depletion or exhaustion and the relative ease and inexpensiveness of obtaining minerals from comparatively unexploited sources in underdeveloped and some developing countries, notably in the Middle East, South America, Southern Africa, and Australasia. Governments of the industrialised nations, concerned about the reliance of their economies on imported raw minerals examined both the degree of reliability and the extent of mineral resources in the countries and regions supplying the essential minerals. This brought a painful awareness of the vulnerability of industrialised countries as a result of the possible interruption of their mineral imports. In this regard, the United States of America may be quoted as a case in point: a report by a House of Representatives Subcommittee on Mines and Mining (Santini Subcommittee)1 revealed that the United States in 1980 was dependent on foreign sources for more than 50 per cent for 24 of the 32 minerals essential for national survival. The Subcommittee also acknowledged that although the United States may develop its own alternative energy sources, there are in many cases no substitutes for the strategic + minerals imported from foreign sources, from countries which are often unstable at best, hostile at worst. This resulted in various policy responses as well as contingency measures, amongst other, renewed emphasis on the utilisation of domestic mineral resources, an intensified search for substitutes of critical minerals and increased stockpiling programmes. Increased attention was devoted to analyses of the political and economic conditions prevailing in the regions from which strategic and other minerals are exported to the industrialised countries, and the formulation of policy measures vis-a-vis those regions. One region which attracted a considerable degree of attention has been Southern Africa, and in particular South Africa.2 The Santini Subcommittee affirmed that while the bulk of the minerals imported by the United States is supplied by a number of source countries, a host of critical[t] minerals vital to the well-being of that country (and this includes all the Western industrialised countries) originates from Southern Africa, a region, deservedly referred to as the "Persian Gulf of Minerals". Apart from the Republic of South Africa the mineral-rich countries concerned are Angola (diamonds, iron ore, oil), Botswana (diamonds, coal), South West Africa/Namibia (diamonds, uranium), Zambia (copper, cobalt), Zaire (industrial diamonds, copper, cobalt) and Zimbabwe (gold, nickel, chromium, asbestos). The Subcommittee however noted that, with the exception of cobalt, the greatest portion of the reserves of the critical minerals listed, lies within the borders of South Africa. SOUTH AFRICA A RELIABLE PURVEYOR OF MINERALS In view of the continual instability and political risk, along with the nationalisation of mineral industries in third world countries, importing industrialised nations have in recent years become more and more concerned about security of long-term supply, and have in consequence begun to diversify their mineral enquiries to areas where the following conditions prevail: • Long-standing record of consistency of supply; • An economic system of private enterprise; • Political stability; • A well integrated infrastructure, with a maintenance of transportation and development costs at realistic levels, and • Attractive investment opportunities, with security of the return of profits.