Shafts echo with calls for mining nationalisation

While the cliché that history repeats itself is not quite true, the latest Julius Malema controversy with his calling for the nationalisation of mines, does clearly illustrate that events often find echoes through history.

During the two general elections that took place in South Africa in the 1940s (the first during the War in 1943; and the second in 1948, which saw a change of government) the National Party (NP) campaigned among others on a ticket that it would nationalise the mining industry in the country.

Once it came into power, the demand for the nationalisation of the mines faded.

Interestingly, one of the strongest campaigners for nationalisation in an election pamphlet that he produced was a young Dr Nico Diederichs who, like Malema now, was in his 30s at the time. He would later in life, as South African minister of Finance, become known as "Mr Gold."

He also served as the last state president under the 1910 Constitution, which was replaced with tricameral dispensation for whites, coloureds and Indians.

Not only do the realities of the practical management of Africa's largest economy come into play once the political power has been won, but the mining houses are also huge players in the market - and with that comes influence and clout.

The investment in highly sophisticated production operations is estimated to be between R1.2 and R2 trillion, which would make any expropriation exercise almost impossibly expensive.

It is also a fact that the trend throughout Africa is in exactly the opposite direction.

International Bar Association mining law chairperson, Peter Leon was recently reported as saying that countries such as Ghana, Tanzania and Botswana had introduced reforms to the mineral laws that were encouraging foreign investment.

Running modern mines successfully calls for - besides the sophisticated and expensive technology involved - a degree of special expertise and experience in a global world of volatile commodity markets and cyclical economic swings.

Backed by some trade unions or not, the risk of Malema's call for the nationalisation of mines becoming a reality seems quite remote.