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Challenges in South African Mining Sector Lead to Job Losses Amid Infrastructure Woes

February 27, 2024

The CEO of Business Leadership South Africa, Busisiwe Mavuso, has highlighted the distressing trend of job losses within the South African mining sector, attributed to a combination of logistical bottlenecks and falling commodity prices. Mavuso pointed out that the accumulation of unsold stockpiles, a direct consequence of inefficiencies in the country's rail and port services, has forced several mining operations to halt production and lay off workers. Companies such as Sibanye-Stillwater, Anglo American Platinum, Impala Platinum, and ArcelorMittal South Africa are among those significantly impacted, marking a concerning phase for an industry already grappling with the cyclical nature of commodity markets.

The logistic challenges faced by the mining sector are not only causing immediate job losses but also pose a serious threat to the broader South African economy. In response, there's a concerted effort from both the business community and the government to address these issues head-on. Through initiatives like Business for South Africa, stakeholders are pooling resources to tackle the most pressing logistic problems while also pursuing broader reforms aimed at enhancing the overall efficiency of transport services.

A key part of this collaborative approach is the establishment of the National Logistics Crisis Committee, which has been operational for the last six months. This committee, comprising 45 private sector experts and CEOs with expertise in rail, port, and road logistics, is working on several fronts to improve operations. Efforts are underway focusing on policy, regulation, and legislative reforms, with early successes including a significant reduction in the backlog of vessels waiting at Durban port and improved processing rates at the Lebombo border post.

Despite these achievements, Mavuso stresses the importance of long-term solutions to fundamentally transform the sector's performance. Drawing parallels with the electricity sector, she underscores that only through deep structural reforms can sustainable improvements be realized, aiming to mitigate the adverse effects on the mining industry and the economy at large.

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