writes that South Africa's mining and empowerment legislation may benefit Chinese entities rather than discourage their investment in the South African mining sector.
In a recent statement during the Brics conference, the Chinese delegation opined that South African government procurement processes and black economic empowerment policies are potential barriers to Chinese investment in the country. Contrary to this viewpoint, an analysis of South Africa's mining law reveals that Chinese entities enjoy unique advantages when investing, which do not even require citizenship, owing to historical discrimination against Chinese people as a group.
This interpretation finds reinforcement in a pivotal 2007 High Court Judgement which declared that South African Chinese citizens fall within the category of "Black People" as defined by the Employment Equity Act and the Broad-Based Economic Empowerment Act. It is noteworthy however that for the purposes of the MPRD Act, Chinese individuals are not required to qualify as South African citizens to be classified as HDPs.
A comparison of the Codes of Good Practice for the mining sector's definition of "Historically Disadvantaged South Africans" with the HDP definition of the MPRD Act and the Mining Charter, reveals minimal disparities in substance. The reference to South Africans in the definition in the Codes, makes no significant difference.
For the same reasons, Indian persons who are not South African citizens, have the same advantages as they also qualify as HDPs for the purposes of the MPRD Act. Whether India or China takes advantage of this nuance in our mining laws in the context of the stronger ties occasioned by Brics, is the question to be ultimately answered. It is also likely that the Government will amend the definition of HDPs to limit it to South African citizens if such a trend gains momentum.
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