South Africa: How Mineral Mining Changed the Economy
With large deposits of gold, diamond, coal, iron ore, chrome, manganese, platinum, vanadium, vermiculite, palladium, rutile, zirconium and many others, South Africa is one of the world’s most mineral-rich country. It is Africa’s second largest economy after West Africa’s powerhouse Nigeria.
Although South Africa has dropped to fifth position from the exalted second position it once held in global gold mining index, it remains the world’s largest producers of chrome, manganese and platinum.
South Africa holds the record for the world’s second largest producer of palladium, rutile and zirconium. It is world’s largest producer of coal.
Discovery of diamond in 1868 and then gold in 1886 played a vital role in the development of this southern tip of Africa.
This mineral-rich country led to armed struggle in the region. This is evident in the mineral conflict that ensued in the Kimberly diamond mine and the Witwatersrand gold mine giving rise to the 1st and 2nd Boer war.
But history lessons about the futility of mineral conflict are being learned.
Going forward, mineral mining led to the industrial revolution in South Africa throughout the twentieth century.
At the inception, mining was done by locals using aerial rope-ways to clear the debris. In the early 1900s, South Africa’s mining industry employed about 25,000 miners and 10,000 hired laborers.
As mines grew, mining companies employed more laborers. Heavy equipment and skilled miners were brought in to improve production.
This led to establishment of shanty towns for workers near mines including the famed Soweto. Soweto later became the birth place for anti-racial struggles against the white-man led government in the 1950s.
And as local miners increased, so did their needs.
Foods, clothes, medical care, furniture, schools and lot more were needed. Local tribesmen and foreign expatriates alike. This opened up other mining-related business opportunities in South Africa.
South Africa’s automotive industry is large. It is one of the economic spin-offs of the mining sector. Today it is home to leading motor manufacturers like Chrysler, General motors, BMW, Fiat and Volkswagen.
South Africa is on its way to diversifying the economy, as the government seeks to broaden its revenue base to economic branches like agriculture, manufacturing and technology.
Many African countries are yet to harness their mineral deposits. But South Africa has set the pace in the continent. It is easy to forget.
Even though the mining industry appears to be in a downward turn in 2016, the quiet economic expansion – driven by Africa’s home-grown industrialization and rising narrative – will inspire South Africa to take her place.
The country will diversify in time.
South Africa’s mining industry already supports the industrial equipment and services sector. It inspires economic branches in construction, public housing and operation of mines, transport business, freight facilities and tourism.
This is just the beginning.
With Africa’s home grown industries arriving, South Africa’s economy will jump-start agricultural enterprises, manufacturing and human resources development.
It has broad technical expertise in the region.
This is one of Africa’s most promising multi-racial country – uniting blacks, whites, Indians and Asians. Many call it home.
The coming economic boom South Africa confronts in the future is story for another day.
It is more likely that South Africa’s economic revival will be led by the somewhat uneducated, uninformed and unknown tribesmen. And you have to take notice.
There is a generation whose time has come, and they are village businessmen, creative thinkers and inner city entrepreneurs – every day people – who are driving this enduring change.