South African Mining Being Hampered by Regulatory Constraints

Investment in South African mining has fallen by $690m due to regulations and transport constraints, a government official has revealed.

"South Africa has fallen short of the mining boom in countries like Australia and Canada," Bloomberg reported director general of minerals and energy Sandile Nogxina as saying in a speech north of Johannesburg.

Although still the world’s largest producer of gold and platinum, a rule forcing mining companies to sell 26% of their capital to black South Africans saw an initial drop in investment of 20% back in 2004. It then fell by 13% in 2005.

A report into this decline in investment, consisting of government officials, industry representatives and workers, found there to be "uncertainty on the exact requirement to comply with the new law", Bloomberg has reported.

The report also found that a stronger rand, rising costs and port and railway constraints have played a part in the decline.