There's been a fair amount of speculation as to the future of the Mining Charter and how it might move across to the Codes. It is due for its five yearly review in October this year. I found a few articles that discuss this review.
“Where the Mining Charter, I think, has fallen down is that it hasn’t promoted broad-based black economic empowerment, which accounts for some frustration with it by government and by communities.
In terms of the amendment to the Mineral and Petroleum Resources Development Act, which is not yet in force, the Minister of Mineral Resources can impose conditions on mining companies to advance the participation of near-mine communities, which new Minister Susan Shabangu referred to in her recent Budget speech.
I like the last paragraph – it's a bit of positive move towards the codes.
This next article shows how the charter's insistence on equity actually contributed to Mvela's demise
Pienaar says: “The fatal flaw in the Mining Charter is the obsession with measuring black empowerment in terms of percentage equity stakes instead of taking an approach based on value. I think it’s often far better to have a 5% stake in a strong business than 51% of a weak business.
“You need to be able to dilute for value and I hope that, over time, the politicians will accept that and realise there are enough other checks and balances in place to achieve their empowerment aims.”
And here is the crux
Mvela’s controlling empowerment shareholders – Afripalm Resources and Mvelaphanda Holdings – are short on funds, which put severe limitations on what Mvela could do without diluting the equity stakes of the two major shareholders that had to be maintained to meet legal empowerment requirements.
Says Pienaar: “We couldn’t go to the market and raise capital to strengthen our balance sheet – as a number of mining groups have done so far this year – because that would have diluted our major shareholders.
From the horse's mouth. The charter is a mess, and the mining codes don't make anything clearer or easier. If you don't believe me take a look here.
Zimbabwe is paying close attention to our legislation too. Mugwump announced a few years ago that a controlling stake had to be given to indigenes. Gono made a recent speech where he poured water on the senile idiot's policy.
Gono is acutely aware of our policies and their potential for cronyism.
I'm not too sure about the complete accuracy of the last paragraph