The South African government is set to overhaul its plans for Black Economic Empowerment (BEE), rolling back much of the regulatory changes that it has introduced in the last decade.

Reports in the Times suggest that deputy president Phumzile Mlambo-Ngcuka, also the former minerals and energy minister with direct involvement in the mining sector, is believed to be planning a major change to existing BEE rules.

BEE was designed to enfranchise the indigenous people said to have been excluded from the emerging economic wealth of the country, with the aggrandisement of the mineral wealth and natural resources in the country – including platinum – remaining a high-profile and sensitive issue.

Under the BEE rules many South African firms were required to hand back up to 26 per cent of their equity to BEE partners.

With platinum mining firms among the biggest participants in the drive, as major employers such as Angloplats and Implats worked with indigenous groups and investment vehicles in a bid to up their BEE quotient, the news is likely to have a significant impact on the pgm sector.

Ms Mlambo-Ngcuka is said to be looking to stimulate economic growth and it is thought that she will aim to kickstart the economy by easing up on the rules currently binding many of South Africa's biggest firms.

A meeting of the dominant African National Congress party is said to have covered plans on how to disentangle the country from its BEE commitments, which have long been a central tenet of South African policy.

As a senior government official told the Times, the move is likely to prove contentious.

"The issue is highly sensitive," the anonymous sources said. "There is a stand-off at the moment, no one will say BEE has not worked but there is a general acceptance that it must change radically. The pragmatists realise that BEE is an impediment towards greater foreign investment."

It is thought that by rolling back BEE more overseas firms will see South Africa as a viable investment.


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