South African President Cyril Ramaphosa may be running out of time to enact the reforms required to attract significant investments in the country\u2019s mining industry.<\/p>\n
That\u2019s the fear expressed by Sibanye Gold chief executive officer Neal Froneman, who prefers to look at opportunities in West Africa, the Americas and Australia.<\/p>\n
The risks of doing business in his home country will increase should weak economic growth and ballooning government debt be compounded by the loss of South Africa\u2019s last investment-grade credit rating, he said.<\/p>\n
“There has been a distinct lack of turnaround, if anything we have gone backward,” Froneman said in an interview before executives gather in Cape Town on Monday for Africa\u2019s biggest mining conference.<\/p>\n
“To be clear and blunt, he also hasn\u2019t made some of the difficult decisions and we are hurtling into a debt trap.”<\/p>\n
Ramaphosa came to office two years ago determined to tackle corruption and revitalize Africa\u2019s most industrialized economy, which has languished after almost a decade of mismanagement under his predecessor Jacob Zuma.<\/p>\n
Moody\u2019s Investors Service, the last company to rate the nation\u2019s debt at investment grade,\u00a0said last week that it\u2019s “a bit early” to judge the government\u2019s policy and structural reforms.<\/p>\n
The government has started rebuilding institutions damaged over the past 10 years, while initiatives on easing immigration rules, releasing new broadband spectrum and finalizing mining regulations will take time to boost investment, according to Khusela Diko, a spokeswoman for Ramaphosa.<\/p>\n
“It is not realistic to expect these interventions to yield immediate results,\u201d she said. \u201cGovernment is confident however these reforms will have a measurable impact on growth and jobs as they take root.”<\/p>\n
While South Africa\u2019s platinum producers have benefited from a surge in metal prices, mining investors are being deterred by regulatory uncertainty and power shortages, Froneman said.<\/p>\n
Sibanye, the country\u2019s largest private-sector employer and world\u2019s No. 1 platinum miner, is considering investments in gold and battery metals, but those will be elsewhere, said Froneman.<\/p>\n
“We don\u2019t see growth opportunities here, so we have to think outside of South Africa,” he said.<\/p>\n
Businesses are concerned about a sense of \u201cparalysis\u201d in the government and the policy splits within the ruling African National Congress, even as Finance Minister Tito Mboweni sets the\u00a0right tone\u00a0for boosting growth, he said.<\/p>\n
“I understand there are factions in the ANC, but it\u2019s time government acted in the national interest and not in the interest of one party,\u201d Froneman said. \u201cGovernment knows what the answers are.”<\/p>\n