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It is an almost unlikely geological coincidence that has made South Africa one of the most important countries in the world for metals and minerals. The world’s largest gold veins were saved from erosion because a meteorite that created the world’s largest impact crater struck land south of Johannesburg more than two billion years ago (see graphic).
The capital needed to develop deep mining was already present in moguls like Cecil Rhodes and Alfred Beit, who 20 years earlier had made fortunes in the Kimberley diamond industry. In 1905, the giant diamond Cullinan, the star of Africa, would also be found east of Pretoria. And as if that wasn’t enough, the world’s largest platinum assets were found just ten miles west of the South African capital. South Africa has had a 70 percent market share of platinum production and has historically produced a third of all gold.
The common denominator of these different geological phenomena is that the landscape is billions of years old and is a remnant of the Precambrian continent of the Kalahari.
But the mining industry became a curse on the country’s majority black population. At most 760,000 people were employed in the mining industry and working conditions were miserable.
The income kept the hate the apartheid system for decades and money that could have been earmarked for social development went to a growing security sector to deal with social unrest.
The gold industry did not adapt to decent working conditions and since democratization in the 1990s, the sector has accounted for a declining share of GDP.
– The system was created for cheap labor and there is no future for large-scale mining in South Africa. On the other hand, it can develop the small-scale mining industry, says David van Wyk, who works at the Benchmark Foundation, which monitors the CSR work of companies.
It is estimated that half of the world’s unexploited gold assets are still in and around Johannesburg. But mining gold to a depth of four kilometers, which takes place today in the still-open mines, is extremely expensive and complicated.
Van Wyk believes that the government should decriminalize the zama zamas and help them organize properly. In return, the state would tax a new sector. The glory days when South Africa produced 1,000 tons a year are over and now “only” 135 tons of gold a year come from South Africa, but zama zama represents seven tons of production that is not taxed.
