S tr a t egy and s tructur e VIEW S FROM C OMMODITY SECT OR LEADERSHIP FORUMS C ONTINUED South A frica s junior and emer ging miners sect or is gr o wing significantly A r esear ch s tudy c omplet ed in 20 19 sho w ed tha t the sect or gener a t ed R544 billion and spent R555 billion It also emplo y s betw een 33500 and 40 300 people dir ectly T he sect or s c ontinuing gr o wth and de v elopment r equir es a c onsider ed and in man y r espects diff er entia t ed r egula t ory r egime t o be adminis t er ed b y the authorities JUNIOR AND EMERGING MINERS LEADERSHIP FORUM Ov ervie w and appr oach T he Junior and Emer ging Miners Desk w as es tablished within the Miner als C ouncil in 20 14 t o servic e the int er es ts and needs of the smaller Miner als C ouncil member c ompanies Junior and emer ging mines ha v e gr o wn int o 28 member c ompanies and tw o as socia tions who c ollectiv ely r epr esent a further 250 smaller entities T hese or ganisa tions no w r epr esent nearly 40 of the t otal Miner als C ouncil membership base T he members ar e gener ally smaller pr oduc ers in c ommodities r anging fr om c oal diamonds ir on or e manganese pla tinum and indus trial miner als Mining c ontr act ors e xplor ers and de v elopers ar e also part of the junior and emer ging miners T he e xplor ers and de v elopers r epr esent 40 of the Junior and Emer ging Miners Desk members F ormed in 20 18 the Junior and Emer ging Miners L eadership F orum JEMLF c omprises the CEOs of 13 member c ompanies with a r epr esenta tiv e on the Miner als C ouncil Boar d T he JEMLF member c ompanies include Bauba Pla tinum Cla y Brick As socia tion K alagadi Manganese MC Mining Ne w V entur e Mining Opal Mining Orion Miner als L edjadja C oal South A frican Diamond Pr oduc ers As socia tion S t one w all Mining W esizw e T ando R esour c es and T heta Gold Challenges and opportunities T he junior sect or in South A frica is under de v eloped in c omparison with c ountries such as Canada and A us tr alia wher e it has pla y ed a big part in driving the o v er all indus try in those c ountries T ypically these ar e e xplor a tion and de v elopment c ompanies tha t r ely on v entur e capital and an enabling polic y and r egula t ory en vir onment in or der t o bec ome suc c es sful In South A frica v entur e capital is not r eadily a v ailable nor has the r egula t ory fr ame w ork been designed t o support and de v elop this important end of the mining indus try Despit e this the junior sect or is s till a signifcant sect or R esear ch c onduct ed b y the Junior and Emer ging Miners Desk indica t es tha t in 20 18 the annual turno v er of the sect or w as R544 billion and e xpenditur e w as R555 billion Pr ocur ement w as R212 billion and emplo y ee c os ts w er e R10 5 billion making this a signifcant subsect or of the mining indus try See belo w f or mor e k e y fndings of this r esear ch s tudy Importantly the junior sect or is the k e y driv er of the futur e mining indus try as e xplor ers and geologis ts identify ne w deposits f or futur e de v elopment W ithout this input the indus try will slo wly decline T he r ec ent r ene w ed int er es t in this sect or indica t es its s tr a t egic signifcanc e T her e ar e also signifcant opportunities Smaller pr oduc ers can e xploit r eserv es tha t ar e not c os t ef ectiv e f or majors and the y ha v e mor e efcient ec onomies of scale T his has also pr o vided an important entry point f or BEE c ompanies wishing t o ent er the indus try T he gr o wth in BEE c ompanies particularly in the c oal sect or bears t es timon y t o this T her e ar e also opportunities in specialis t fnancing arr angements ca t ering f or this sect or Both the Indus trial De v elopment C orpor a tion and the Public In v es tment C orpor a tion ar e looking int o setting up specialis t funds t o driv e the junior sect or In addition the Junior and Emer ging Miners Desk is w orking with an int erna tional la w frm t o pr oduc e a tax inc entiv e s y s t em such as the fo w thr ough shar e model which will help s timula t e in v es tment in highrisk pr ojects including e xplor a tion A ctivities and f ocus P erhaps the mos t important c ontribution of the JEMLF so f ar has been the inclusion of a mor e r ele v ant r egime f or junior c ompanies in Mining P age 50