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2 E&MJ; • JULY 2017 FROM THE EDITOR The world these days seems highly polarized, where even- ly divided groups of people are taking extreme positions. This can be seen in several recent elections and referen- dums, and it has shaken the status quo. This is also having a knock-on effect on mining. Some governments who real- ize the importance of mining to regional economies have reversed course and created an environment conducive to mining-related investments. Others, many of which take mining for granted, are moving in the opposite direction, not realizing that excessive taxation and regulation may be killing the Golden Goose. E&MJ;'s lead news story this month covers the new mining charter that was in- troduced in South Africa during June. The country is blessed with an abundance of natural resources. Some of the world's deepest and richest gold mines are located near Johannesburg. They are steeped in history. They are also mature and costly to operate. This new mining charter, however, covers all mining, not just gold. South Africa produces platinum group metals, diamonds, coal, iron ore, etc. The mining business is shrinking in South Africa. In 1980, a year considered the pinnacle for mining in South Africa, the mines accounted for 20% of the GDP. Now, that fi gure stands at a little more than 7%. E&MJ; routinely reports the problems the South African mines face: high mining costs, labor issues and low productivity. These are challenges all miners face around the world and they are exacerbated by relatively low metal prices. These issues are more acute in South Africa. The new mining charter introduced by the South African government will not help the situation. It's a populist move related to black economic empowerment (BEE) initiatives. As readers will see in much more detail, it will force companies to ensure that at least 30% of their shares are controlled by blacks, even if they decide to sell them. That's an increase from 26%. South African mining companies will now face a host of new BEE requirements. The charter's release initiated a sell-off of South African mining stocks world- wide. As this edition was going to press, AngloGold Ashanti, a major multinational gold miner, announced plans to lay off 8,500 miners, nearly a third of its workforce, from mines it now considers unprofi table. E&MJ; expects to receive more similar reports from the fi eld. South Africa was not the fi rst country to surprise its mining industry with addi- tional regulations. They also were not the fi rst to introduce policies without thinking them through. And, they won't be the last. Without a change to a more free-market approach, the mining sectors in these countries, and South Africa in particular, tragically will become history. One man's loss is another man's gain as they say. Those mining-related invest- ments, which eventually become jobs, will be redirected to other mining-friendly jurisdictions. While everyone would like to see metals prices increase because of demand, removing output from the market will have the same effect. A Mining Crisis Looms in South Africa The world these days seems highly polarized, where even- ly divided groups of people are taking extreme positions. This can be seen in several recent elections and referen- dums, and it has shaken the status quo. This is also having a knock-on effect on mining. Some governments who real- ize the importance of mining to regional economies have Steve Fiscor Publisher & Editor-in-Chief Steve Fiscor, Publisher & Editor-in-Chief sfi scor@mining-media.com Mining Media International, Inc. 11655 Central Parkway, Suite 306; Jacksonville, Florida 32224 USA Phone: +1.904.721.2925 / Fax: +1.904.721.2930 Editorial Publisher & Editor-In-Chief—Steve Fiscor, sfi scor@mining-media.com Associate Editor—Jennifer Jensen, jjensen@mining-media.com Technical Writer—Jesse Morton, jmorton@mining-media.com Contributing Editor—Russ Carter, rcarter@mining-media.com European Editor—Simon Walker, simon.emj@btinternet.com Latin American Editor—Oscar Martinez, omartinez@mining-media.com South African Editor—Gavin du Venage, gavinduvenage@gmail.com Graphic Designer—Tad Seabrook, tseabrook@mining-media.com Sales Midwest/Eastern U.S. & Canada, Sales—Victor Matteucci, vmatteucci@mining-media.com Western U.S. & Canada, Sales—Mary Lu Buse, mlbuse@mining-media.com Scandinavia, UK & European Sales—Colm Barry, colm.barry@telia.com Germany, Austria & Switzerland Sales—Gerd Strasmann, info@strasmann-media.de Japan Sales—Masao Ishiguro, ma.ishiguro@w9.dion.ne.jp Production Manager—Dan Fitts, dfi tts@mining-media.com www.e-mj.com Engineering & Mining Journal, Volume 218, Issue 7, (ISSN 0095-8948) is published monthly by Mining Media International, Inc., 11655 Central Parkway, Suite 306, Jacksonville, FL 32224 (mining-media.com). 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EXECUTIVE OFFICE: Mining Media International, Inc., 11655 Central Park- way, Suite 306, Jacksonville, FL 32224 USA phone: +1.904.721.2925, fax: +1.904.721.2930, www.mining-media.com COPYRIGHT 2017: Engineering & Mining Journal, incorporating World Mining Equipment, World Min- ing and Mining Equipment International. ALL RIGHTS RESERVED.