Engineering News – South Africa has plummeted to an abysmally low level in the World Bank’s 160-country cost-of-doing-business rankings. On the bank’s Doing Business scale, which measures the fitness of a country’s economy to grow and compete, South Africa has tumbled 15 notches since 2007, from position number 58, to position number 73.
Revealing this on Tuesday, Chamber of Mines of South Africa CEO Roger Baxter also drew attention to the Fraser Institute placing South Africa eighty-first out of 109 countries on current mineral policy potential. Sixty-seven percent of 1 600 respondents gave South Africathe thumbs down as a mining investment destination. Currently dogged by policy risk issues, legislation and regulatory issues, operational cost factors, labour and community risks and all-inclusive cost jumps, South Africa is seen as being in increasing danger of not delivering on its huge resources promise.
The application of the measure to South Africa’s mining industry is exacerbated by mining’s own unique set of investment characteristics – being a high-risk industry with very long lead times to production and being capital intensive, with much of the capital having to be spent well ahead of any return.
“We need all the people to be paddling in the right direction and obviously fixing the hole because if the canoe sinks, we all sink. In some of the conversations I’ve been in more recently, we’ve started to make progress,” Baxter confided.
