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he
AfricAn Business Journal
Business and culture
aic wm i bsiss
arts & entertainment
ot aic - Mvis
company Focus
ig Miig Cmp
auGuS 2011 Vm 2 Iss 8 www.tabj.co.za
IN THIS ISSUE
FairtradeChanging the future of Africa
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2 SECTIONTitle
- INFORMATIVE WORKSHOP SESSIONS
- NETWORKING OPPORTUNITIES
- AN EDUCATIONAL AGENDA
- CASE STUDIES AND BEST PRACTICES
WWW.ITINFRASTRUCTURE.CO.ZA | CAPE TOWN | 18 - 19 AUGU
WWW.KINETICEVENTS.N
[email protected]+27 21 555 08
IT INFRASTRUCTURE SUMMIT
OPENING ADDRESSMrs. GNM Pandor, MP
Minister, Science &
Technology
Te II Summit welcomes all Senior I Leaders, I
Inrastructure Managers and CIOs to join us or atwo day event that will address how an innovativeand stable I Inrastructure can drastically reducecosts and improve business efciency
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eDiTOrsnt
HellO everyBODy,
Youll notice that the prole picture above
has been invaded by a gentleman with
whom you are most probably unfamiliar.
Rest assured, it is all above board; the man
in question is me, John Pinchingproud new
editor ofThe African Business Journal.
This month has been my rst full issue
and inevitably you will notice a slightly
different style, which I hope you will nd
interesting, informative and entertaining!
The mag has got the usual aperitif
of business news, followed by stories of
companies making an impact in Africa.
Indeed, as several global markets show signs
of recovery, its encouraging to see businesses
are starting to get excited again. This editionhas good vibrations from the mining, aviation,
food and property industries, while a welcome
call from the wild comes courtesy of South
African National Parks.
In addition there will be a refreshed selection
of features, hopefully suiting a wide range of
tastes. These include a jaunt through African-
inuenced cinema, how African women are
changing the business landscape and the
legacy that the FIFA World Cup in Africa has
left behind.
Leading the way in my inaugural issue
is our fascinating interview with Fairtrade.
This extraordinary charity takes us through
its inspirational journey across Africa during
the last decadechanging attitudes, getting
a better deal for farmers and transforming
lives. What better way to start my rst issue?
Fasten your seatbelts and enjoy the ride.
John
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maerskline.com
Proudly serving AfricaHow do we serve Africa? With 22 brand new ships, for starters.
And believe us: Teyre no jus any
ships. Wih wice he capacit of he
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hese proud vessels are he larges
ever o call a Wes African pors.
Tey are also models of energy
eciency, helping o propel
African exporers and imporers
o environmenal leadership by
slashing CO2 emissions from
ranspor by 30% per conainer.
Why are we making such a big deal
abou Wes Africa? Because Africa
maers. o Maersk Line and o
he world. And as a world leader in
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22 custom-built ships, the largest in West Africa Te markets best network
Unmatched schedule reliabili
Personalised service and strong local presence
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Sara Kopamees | Editr i Chief | [email protected]
John Pinching | Editr | [email protected]
Ben Watts | Staff Writer | [email protected]
Cory Wilkins | Editrial Assistat |[email protected]
Vladimir Lukic | Creative Directr | [email protected]
Chris Moore | Sr. Advertisig Desiger | [email protected]
Margaret Oldham | Sr. Graphic Desiger | [email protected]
Wincy Law | Sr. Graphic Desiger | [email protected]
Tanya George | Advertisig Desiger | [email protected]
Marc Mauricio | IT/Prducti Supprt | [email protected]
Natalie Edney | Head f Sales | [email protected]
Khayyam Darr | Research Directr | [email protected]
Andrew Miskin | Research Directr | [email protected]
Brett Haigh | Research Directr | [email protected]
Justin Lejuene | Research Directr | [email protected]
Hugh Braithwaite | Research Directr | [email protected]
Dee Nazer | Research Directr | [email protected]
Michael Alexander-Jones | Presidet | [email protected]
Linda Neal | Chief Executive Ofcer | [email protected]
Naveed Yusuf | Chief Information Ofcer | [email protected]
Gemma Parkins | Executive Assistat | [email protected]
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010
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b cOnTenTsauGuS 2011 | VoluMe 2 | ISSue 8
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wOrlD cup at t wist
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FairtradeChanging the future of Africa
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Fitd s md icdib cgs i
aic. Ti g is w mistkb
symb gd c iss. TABJ
edit J Picig sks Fitd aicsexctiv Dict Mic nk w
t it s mgd t civ s mc
TABJ: What does Fairtrade represent in 2011?
MicHAel nkOnu: In a world where food retail is
increasingly dominated by supermarket chains and
price wars, we give farmers and consumers an al-
ternative. Fairtrade helps farmers in Africa improve
their livelihoods by securing better trade conditions,
while we give consumers the possibility to make a
difference through their everyday shopping. Every
purchase of a Fairtrade certied product from Af-
rica contributes to sustainable change in Africa.
TABJ: How does it standout as a charity?
Mn: We do not consider ourselves as a traditional
charity. We create opportunities for farmers whohave been disadvantaged by the conventional
trading system, to earn reasonable income for
their labours. Fairtrade empowers small-scale
farmers to actively participate in the value chain.
It is about a fair price for a fairly produced prod-
uct. Our ultimate goal is for producers to become
economically empowered without our support.
Has the original concept changed much?
Mn: The concept of fair trade has been around for
over 40 years but a formal labelling scheme didnt
get off the ground until the late 1980s, when the
rst Fairtrade coffee from Mexico was sold under
the Max Havelaar label. Since then the system has
grown exponentiallybut the core concept of sup-
porting producers to have sustainable livelihoods
has not changed. In Africa, the biggest transfor-
mation has been the creation of an intra-African
Fairtrade market. While Fairtrade traditionally fo-
cused on producing in the South, and marketing in
the North, we have recently started to introduce the
FAIRTRADE mark to consumers in Africa. Since 200
Fairtrade products like wine, coffee and chocolate
have been available in South Africa and the range
has been immensely popular. In 2010 we introduce
in 20 yeArs we HAve reAcHeD
Over 500,000 fArMers AcrOss
AfricA. TODAy we represenT
MOre THAn 260 prODucer
OrgAnisATiOns AcrOss 26
cOunTries
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12 COVER STORYFitd: Cgig t t aic
the label into the Kenyan market, increasing market
access for African farmers and giving local consum-
ers the choice to support African trade.
TABJ: What was Fairtrades aim when it rst ven-
tured into Africa specically?
Mn: African farmers were involved in Fairtrades
activity from the beginning. Some of the labels
pioneer members are coffee farmers in Moshi,
Tanzania, and played a pivotal role in the initial
movement. We believe that transparent and
equitable trading environments will allow Afri-
can farmers to improve their lives. Today the
Fairtrade concept is thriving throughout Africa.
TABJ: What regions and industries has it concen-
trated on?
Mn: Fairtrade mainly focuses on agricultural com-
modities. Our top products include coffee, tea,
cocoa and fresh fruits, like bananas and pine-
apples. Cotton and owers are also important
categories emerging from Africa. Our farmers are
located in over 25 countries across Africa, includ-
ing those in conict and post-conict, like Congo
and Sierra Leone. We work across the length
and breadth of Africa from North, East, West to
Southern Africa and our grassroots structures,
such as regional and product networks, enable
us to connect effectively with over 500,000 cert
ed producers across the continent.
TABJ: How have your relationships with African
farmers and workers developed?
Mn: Fairtrade Africa represents African farmers in
the Fairtrade systemwe are the farmers. When
changes in the system are being considered, we
ensure that the voice of our members is heard an
that any changes reect their needs and realities.
TABJ: What educational ventures are you in-
volved in?
Mn: We contribute to education in Africa on differ-
ent levels. On top of the minimum price, traders
and consumers pay a sumcalled the Fairtrade
Premiumwhich is invested in social, environmen
tal or economic projects that benet farmers and
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AUGUST 2011 The African Business Journal
their communities. Premiums are often used by
producer communities to support educational proj-
ects. Across Africa, schools are being built, schol-
arships awarded or computer classes set up as a
result of the Fairtrade Premium.
TABJ: How quickly did the organisations mes-
sages spread?
Mn: In 20 years we have reached over 500,000
farmers across Africa. Today we represent more
than 260 producer organisations across 26
countries. That number is growing, especially
now that we are introducing the African consum-
er market to the Fairtrade concept. We are creat-
ing a real movement for change in Africa, similar
to the one that already exists in the North.
TABJ: What have been the signicant milestonesin Africa?
Mn: Apart from the introduction of the
FAIRTRADE mark in South Africa and Kenya, an
important milestone was our rst Fairtrade Africa
Forum, organised last year in Zimbabwe. Produc-
ers, partners and other stakeholders discussed
how Fairtrade can further help farmers achieve
sustainable livelihoods. The forum also offered
producers the possibility to take ownership of
Fairtrade Africa. We are currently planning the
second edition, to be held at the end of Novem-
ber in Accra, Ghana. In addition to the confer-
ence we are setting up a trade exhibition offerin
farmers in Africa a platform to meet with traders
and create market access for producers.
TABJ: Has your work bred more trust between
businesses and suppliers?
Mn: AbsolutelyFairtrade relationships provide
producers with long-term access to markets. Thes
relationships are based on mutual respect, trans-
parency, and commitment, and grow stronger ove
time. The recent developments in the coffee mark
provide a good example. The sector is facing seri-
ous defaults due to the high demand and declinin
yields, but Fairtrade producers are better prepared
for uctuations. The Kagera Co-operative Union
(KCU), a Fairtrade coffee organisation in Tanzania
recently won UK retailer Sainsburys Best Supplier
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14 COVER STORYFitd: Cgig t t aic
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AUGUST 2011 The African Business Journal
relATiOnsHips Are BAseD On
MuTuAl respecT, TrAnspArency,
AnD cOMMiTMenTTHey grOw
sTrOnger Over TiMe
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16 COVER STORYFitd: Cgig t t aic
award. According to the jury, KCUs many merits in-
clude timely delivery, non-defaults, highest quantity
of coffee and unquestionable quality delivery. Quite
an achievement!
TABJ: Are you surprised at how instantly recogni-
sable the Fairtrade brand is in Africa and on a
global scale?
Mn: We have been around for 20 years, creat-
ing a real movement in the North. Over the
years the work of our dedicated Fairtrade
organisations such as TWIN, Divine, Traidcraft,
Caf Direct have worked with farmer groups
supporting their capacity building. Major
brands such as Starbucks and Cadbury have
also launched Fairtrade products, increasing
the visibility of the FAIRTRADE Markin addi-
tion to numerous other products, which youcan nd on the shelves in local shops. African
farmers believe fairer trading conditions are
the way out of poverty and producers have
denitely seen the change in their lives com-
munities. Fairtrades success in Africa demon-
strates that consumers and the general public
think trade, not hand-outs, is the way to allev
ate poverty.
TABJ: In what way have attitudes changed be-
cause of Fairtrade in Africa?
Mn: We have seen a major change in how busi-
ness is done, especially in the cocoa sector in Wes
Africa. With major brands switching, competitors
are beginning to think about how they source their
products. The impact of the Fairtrade Premium,
which is invested in social, environmental or eco-
nomic community projects, has been very inuen-
tial. In Africa, Fairtrade has contributed hugely to
improving the capacity of farmer organisations. To
become certied, cooperatives need to develop
business strategies and implement nancial or
environmental management plans.
TABJ: What is the most rewarding aspect of
Fairtrades tireless efforts?
Mn: It is the change we see taking place at in-
dividual, household and community levels. It
satisfying to see how Fairtrade is transformin
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AUGUST 2011 The African Business Journal
communities through community health cen-
tres that offer maternity care for women and
classrooms that reduce the walking distance
of school children. It is equally rewarding to
hear how farmers outgrow themselvesbeyond
Fairtrade. Due to the management changes
made, many farmers are able to start apply-
ing for grants or partner other NGOs in further
improving their livelihoods.
TABJ: Are there plans to expand the operation in
Africa?
Mn: Yes, the biggest shift is the opening and ex-
panding of consumer markets, but we also want
to reach out to more producers, targeting new
countries like South Sudan. We are also devel-
oping standards for new products or expanding
existing commodities.
TABJ: What are the long term ambitions in Africa
Mn: The vision of Fairtrade Africa in the next
ve years is to develop into a formidable Afri-
can-based producer organisation, supporting
capacity development in Africa and facilitatin
intra-African trade for producers, enabling an
increase in market access, food security and
wealth creation. TAB
fAirTrADes success in
AfricA DeMOnsTrATes THAT
cOnsuMers AnD THe generAl
puBlic THink TrADe, nOT HAnD-
OuTs, is THe wAy TO AlleviATe
pOverTy
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Muse bsiss ws c
sOuTH AfricA super BrAnD
International Marketing Council (IMC) of South
Africa CEO, Miller Matola, has claimed that the
role of ambassador belongs to all South Africans,
especially when it comes to promoting the country,
its innovation, people and economic sustainability.
The rousing call was made at a stakeholder
summit held at the Durban International
Convention Centre.
The IMC is responsible for the South African
brand and works on transforming the countrys
image by developing and marketing strategies that
invite the rest of the world to experience South
Africa through either tourism or business ventures
A nations brand determines to a large extent
how well a country competes for its share of inves
tors, consumers and visitors in a global economy.
South Africa has been written off several times, bu
has managed to prove its competence, said Ma-
tola.
We see possibilities in everything, provide in-
novative solutions and have become a key player
in global institutionsthis is what we need to be
selling, he added.
The IMC conducts a Domestic Perceptions Au
dit to nd out how South Africans feel about their
country.
It monitors what the media is reporting abroad
through the Reputation Industry tool. They also
use the International Tracker Results to see where
in the world elite businesses are choosing to invesThere are also campaigns being run to help
promote the country. A more recent example is the
Play your Part campaign during which South Afri-
cans were asked to give someone a helping hand
either with their time or resources.
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g t aic
spurreD On
Tottenham Hotspur Football Club have arrived
in Johannesburg for the Vodacom Challenge, a
traditional pre-season tournament.
Spurs former skipper Gary Mabbutt (right)
insisted that the London team were not in South
Africa on for a jolly but as important prepara-
tion for their rst Premiership of the new season,
against Everton on August 13.
The North London clubs opening game of
the Challenge is against the Kaizer Chiefs at the
Peter Mokaba stadium in Polokwane. They will
also face PSL champions the Orlando Pirates.
Mabbutt, now a team ambassador, said
Spurs had brought their best players, including
the unsettled Luka Modric, to South Africa and
that coach Harry Redknapp was expecting a
tough challenge.I get frustrated when people say we are here
just on a pleasure trip around South Africa, said
Mabbutt, who played more than 480 matches for
Spurs between 1982 and 1998. This country is
a great location for our pre-season preparations.
The PSL (South Africas top football divi-
sion) had one of the most amazing nishes last
season, with Chiefs, Pirates and Ajax all in it. We
want to win the Challenge trophy, but we know
its not going to be easy, he added.
South Africa has been thriving in terms of
both professional football, and as a formidable
place to do business, since last years highlysuccessful and well-organised World Cup tourna
ment. The recent visit of teams such as Spurs
and Manchester United has ensured that tradin
in South Africa keeps improving.
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20 SECTION it
Muse bsiss ws c
Merkel MAkes energy TAlk
Germany is seeking to bolster renewable energy
trade with Africa, Chancellor Angela Merkel (right)
said, during her recent visit to the continent.
German solar power entrepreneurs see Af-
rica as a potentially huge market for their prod-
ucts and part of Merkels visit to Kenya included
a look at the German-made solar technology at
the new headquarters of the UN Environment
Program in Nairobi.
She and UNEP Executive Director Achim
Steiner toured the new ofce facilities, which
boast more than 64,000 square feet of solar
panels, energy-saving lighting and other green
features.
Merkel said before the tour it was an ex-
ample of how Germany and Africa can help each
other economically on energy.Germany intends to demonstrate how it is
also possible to produce energy using renewable
sources, Merkel said. I believe that Germany is
a prominent leader in this eld and weve dis-
cussed how we can cooperate more closely in
the energy sector.
Accompanying Merkel in Africa were a group
of German parliamentarians and business lead
ers who were seeking ways to boost the role of
Germanys private sector in developing an Afri-
can green economy.
Germanys renewable energy trade with Af-rica amounts to $396 million per year but indus
try backers insist that amount could be greatly
boosted.
PHOTO BY 360B / SHUTTERSTOC
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AUGUST 2011 The African Business Journal
g t aic
lOAn HArk
Micro, small and medium enterprises (MSMEs)
in North Africa are key to driving employment for
millions of young citizens, but businesses on the
smaller end of the scale have some of the lowest
level of access to nance in the world.
The approval of a $50 million loan to Tunisia
marks the launch of a World Bank facility
designed to address this. The World Bank
Groups MSME Facility is expected to channel
over $500 million to Middle East and North
Africa (MENA) countries over the next ve years,
including support from the International Finance
Corporation, regional partners such as the
African Development Bank and donors.
This regional facility and a partnership with
a number of development institutions, is a stron
and timely response to a MENA-wide lack of
access to nance and jobs and is a critical pilla
of the World Banks Arab World Initiative, said
Shamshad Akhtar, Vice President for the MENA
region at the World Bank.
SMEs in the region have enormous
potential to create much-needed employment
opportunities for a growing, young and
increasingly impatient population. We urgently
need to start this engine and creating access to
nance is critical, he added.
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22 SECTION it
Muse bsiss ws c
vOTe Of cOnfiDence
Encouragingly, the Africa Business Condence
Index (ABCI) for June shows growth in both the
index for manufacturing and non-manufacturing
sectors in Africa, the Africa Business Panel has
announced.
The difference compared to May in the indi-
ces for manufacturing and non-manufacturing is
0.1 and 3.3 percentage points respectively.
Business professionals from 30 countries
in Africa participated in the survey making the
results a reliable gauge and early indicator of
the underlying economic activity on the African
continent.
freeDOM figHTers
A survey of chief executives in 10 African coun-
tries has found that businesses in Africa enjoy
more freedom. In addition regional governments
are apparently more attentive to the private sec
tor than in previous years.
The study, released by PricewaterhouseCoo
pers, asked 201 business leaders from a broad
cross-section of industries within local and expa
triate businesses.
Philip Kinisu, a top ofcial with Pricewater-
houseCoopers in Kenya, said The private sec-
tors in Kenya, South Africa, Nigeria and Rwanda
are actively and energetically participating with
governments on strategic planning.
The survey found that chief executives are
generally optimistic about economic growth in
Africa with more than 60 per cent expecting thebusiness to grow in the next 12 months.
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AUGUST 2011 The African Business Journal
g t aic
MurDOcH MOsT HOrriD
It may not be directly linked to African business
but the damage done to the so-called Murdoch
Empire has far reachingand mainly positive
consequences for journalism, reportage and the
integrity of the western press.
When the News of the World nally fell on
its swordseveral years after private investiga-
tor, former AFC Wimbledon striker and all-round
slimeball Glenn Mulcaire slithered into prison
there was an almost universal sigh of relief. For
scribes the world over it is a victory worth savour-
ing, for it is essentially a successful assault, not
only on immoral practices, put the arguably more
loathsome practice of publishing puerile, mind-
numbing, culturally bankrupt passages about
cretinous footballers and talentless celebrities.
It has also brought to account the somewhatbafing inuence of the Murdoch family (and
indeed the hitherto untouchable mane of red
hair that is Rebekah Brooks) on governments and
governmental policyand this can only be seen as
a natural restoring of the universes equilibrium.
We have witnessed the death of a publication
which, despite its name, had a no relationship
with news, no resonance with the world and no
place on the news stand.TAB
PHOTO BY STOCKLIGHT / SHUTTERSTOCK
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C One vOicepp t iss mpwig wm iaic bsiss it
itti gds?HOw HillAry clinTOns wOrDs AT THe AfricAn uniOn
cAn MAke A Big iMpAcT AnD Drive iniTiATives frOM THe
glOBes MOsT viTAl fOrces BeHinD eMpOwering wOMen
in Business
Business & culTur
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26 BUSINESS & CULTURE aic wm i bsiss
awys wm t cptivt dic,
u.S. Scty Stt hiy Cit
cd tg cwd w s ddssd
t aic ui (au) i addis abb,etipi J 13.
if All THe women in Africa from Cairo to Cape
Town, decided they would stop working for a week,
the economies of Africa would collapse, she an-
nounced, drawing pause from many of the dele-
gates representing 53 African nations who did not
necessarily share her sentiments.
The women of Africa are the hardest working
women in the world.
A strong advocate for womens rights on all
fronts from her Talking it Overnewspaper columns
(1995-2000) to her famous Womens Rights are
Humans Rights speech (2008) and more recently
her role in speaking out against driving bans in
Saudi Arabia, Clintons position when it comes
to the role of women in businessand how this
ought to be maximised globallyis a pretty well-de-
ned talking point. But is she merely another highprole political gure with a platform for rhetoric
and little swing to foster change, or an important
means for organisations to get their messages
heard and put pressure on the right points of con-
tention to aid progress?
One month on from her high prole address
to the AU, how have law-makers and commenta-
tors throughout African continent reacted to her
calls for improvement, and what is really being
done on the ground to enact change for the em-
powerment of women in the nations business
sector?
A trigger or progress
Before accounting for Clintons remarks at the
AU meet, it is important to outline the attention
that Africa-U.S. relations have gotten in the past
couple of months. In June U.S. President Barack
Obama played host to Goodluck Jonathan, Presi-
dent of Nigeria, and President Ali Bongo Ondimb
of Gabon, at the White House. First Lady Michelle
Obama, with daughters in tow, also toured South
Africa and Botswana. Then at the closing cer-
emony of the African Growth and Opportunity Act
(AGOA) forum, Clinton announced that the U.S.
will commit $2 million to the African Womens
Entrepreneurship Programme (AWEP); days befo
speaking at the AU gathering.
Clintons own prevalence in empowering women in Africaincluding those in business dates
back to her 1995 ve-nation South African tour.
She has since declared this tour to have been a
transformative experience (and one well in ad-
vance of her own ascent into politically-motivated
spheres) which may account, in part, for why her
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AUGUST 2011 The African Business Journal
words are believed to carry such weight in terms
of policy-making, global investment attention and
general media coverage.
In addition to the various images, depicting
her standing alongside women from rural, tertiary
and family business enterprises, her unrelent-
ing commitment to the issue strikes some heavyheadlines and spotlighting that likely makes
numerous autocrats uncomfortable. Her endorse-
ment of public and private entity-led schemes and
commitments elevates any due organisations
prole, forcing change rather than merely sug-
gesting it. The AU address demonstrates this well:
While many ofcial attendees remained stoic
in the wake of her comments about empowering
women in business, raucous applause ensued
from the gallery section, signifying that while som
in power may not kowtow to her words, her role in
the minds of many is weighty enough to convey
the message intended; with or without getting astanding ovation from those in the room.
Complimenting initiatives
While Clintons role as a mouthpiece cannot be
underestimated, it is likely to be most effective
when in synergy with the various bodies
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28 BUSINESS & CULTURE aic wm i bsiss
campaigning, lobbying and driving change in
the role of women in African business in other
echelons. She and like-minded public gures,
have forced the subject into the highest agendas
of various important international organisations,not least that of the United Nations (UN) and its
new arm, UN Women. The unit announced its rst
UN Women Justice Report in early July, Progress
of the Worlds Women: In Pursuit of Justice. The
report aims to convey why nancial support is a
must-have to ensure the betterment of women
related to gender equality, with a sizable portion
sliced up and dedicated to roles in the business
world, including in Africa. Two of the groups ve
aims are of particular signicance: enhancing
womens economic empowerment; and makinggender equality central to national development
planning and budgeting. The report outlines wha
it will really take to bolster development, from
heightening womens inputs in policy-making and
political choices, to proper allocation of land and
agricultural resources, education and healthcare
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concerns, and how social injusticeslong-
engrained in some statescan most effectively
be tackled and dealt with in strategically to long-
term success. Simultaneously, these overarching
reports factor in contribution from various other
bodies, concerned with progress in more specicareas including how to work on up-skilling women
in given regions, encouraging entrepreneurship
and providing day-to-day support in the form
of centres, advisors and local-level programs.
Investigation of each of these levelsClinton
and her role as a part of the media message;
research and bodies working for policy-making
and legislative change; and smaller groups
dedicated to working on an individual basis to
improve daily lifeunveils how local, national
and international levels can collide and work
more effectively between one another, as well aidentifying why Clintons comments can, possib
carry far more signicance than rst impression
suggest.TAB
MAking A Difference
For more information about companies and organisations working to empower
women in African business at every level, please see this snapshot:
The African Women In Business Initiative (AWIB), from the African
Development Bank (AfDB)
The Global 10,000 Women Certificate Programme for Entrepreneurs funded
by Goldman Sachs.
The Businesswomans Association of South Africa (BWA
The International Finance Corporation (programs Village Phone and the
Democratic Republic of Congo Access to Finance Project received Gender
Awards for empowering women in business).
Uganda Network of Women Entrepreneurs (UNWE)
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license TOB Cip Miig d D
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32 RESOURCES B Cip Miig d Diig
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frOM iTs OriginAl conception, rather than chasing
the fast buck, Blue Chip Mining actually spent 18
months training staff, sourcing equipment, mak-
ing quality control testing and generally polishing
its products; only starting to trade when absolutely
sure it would deliver the best possible service to itscustomers. Its brand and reputation were always
going to be the foundations upon which the new
company would build its empire.
Thanks to that initial investment the compa-
ny is now one of the most reputable and ourish-
ing drilling and mining companies in Africa, with
several lucrative contracts with big companies,
including corporation giants Anglo American. Its
safe to say the idea of medium term analysis fo
long term gains has been an unprecedented su
cess, with each year reinforcing how sensible it
was to look at the bigger picture in the rst plac
Climbing high
In the years since it began trading the company
has leapt from a small, level eight company to a
large level three operation, on the South Africa
mining league table. For those that are not fam
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36 RESOURCES B Cip Miig d Diig
iar with the scoring system, this is a bit like South
Africa reaching the World Cup Final!
During this galvanising period it has over-
taken many historically advantaged competitors
in the eld, while also expanding into services
in different categories across the mining realm.
This impressive diversity includes catering for
the local market, in which it has no recognisablecompetitors. For these small regional businesses
it mainly acts as a priceless source of advice for
applicants seeking mining licenses.
Managing Director Martyn Van Zyl has been
impressed by the rapid progress: Where we have
outsourced certain processes in the past, we now
do the vast majority of the work in house, he says
Efciency is a major part of our focus, ensuring
that we save client costs and become really com-
petitive in the tendering process.
Explosive impact
The company also has its own licence with the
South African Police allowing it to handle explo-sives, perform blasting and complete processin
to the nal product before it goes to the smelt
pits for renement. Its entire eet has also been
equipped with mobile mining equipment, while
also changing its workshop to a mechanical
operation, allowing employees to use equipmen
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they are familiar with in every location.
Safety is at the forefront of Blue Chips priori-
ties and all equipment meets the countrys robust
standards, resulting in exemplary working condi-
tions and a record of safety that is second to none.
We do a comparative analysis of parts and
products, testing vigorously before we promote
them to clients, or include them in our opera-tions, adds Van Zyl.
With further efciency targets on the horizon
the company will stop at nothing to ensure cut-
ting edge practices. Indeed, Blue Chip is currently
testing the life span of drill bits, determining the
most abrasive metals. The outcome shows exact-
ly what is required for better penetration and ho
many metres can be mined every minute.
Martyn explained how the reputation of the
company came above everything else. We dont
want to engage in practices that can cause damag
to the company, so ethics are a high currency in o
organisation, he says. It is essential that we also
subscribe to the policies of our biggest clients be-cause they are constantly under the microscope.
Revolution
Coming through a period of global for everyone,
historical and political transformation for South
Africa in 1994, the company has continued to
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evolve, while embarking on positive discussions
with government ofcials about future projects
and how to use existing public sector equipment
cost effectively.
The economic downturn, while proving a big
challenge, was overcome with careful planning,
regular consultations among staff and using
prots to improve maintenance. This meticulousapproach, which has always proved so benecial,
even before the recession, meant that the com-
pany and its 300-strong workforce didnt suffer
any long term problems.
The practice of forging good professional
relationships, formed in a competitive but buoy-
ant industry will ensure optimum trading for
the company over the next 20 to 50 years. In
recent yearsparticularly since the radical cul-
tural changes of the mid-ninetiesthere has als
been a noticeable increase in the demand for
South African expertise in civil engineering and
mining, where in the past companies may have
approached India or China instead.With seven years of faultless operations, in-
dustry integrity ingrained in its philosophy and a
position at the summit of its eld, the company ha
every reason to keep chipping away.TAB
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li t t040Miig cmpy pvs tt
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resOurc
Ope Mining
ck cg t byss c b t mkig y
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42 RESOURCES p Miig Svics
in THe currenTclimate, experience and knowl-
edge represent the greatest advantages for
businesses in any industry. For Trollope Mining
Services, a combination of these assetsalong
with a considerable harvest of passion and ambi-
tionhas been more essential than ever. Indeed,
in the ght for survival the company has actuallyourished, showing itself to be among the ttest
mining companies on the block. Reassuring proof
that sometimes the good guys get their rewards.
Brothers in arms
Trollope Mining Services was created 35 years
ago when two enthusiastic brothers, Peter and
John, bravely took their rst steps in business.
They started off the Trollope enterprise by tena-
ciously purchasing ex-military equipment from
auctions. Using their farm as a base the pair the
began to reuse their acquisitions on short-term
contracts in the mining business, and the rest, ihistorybut a history worth telling.
During those halcyon early days the brother
saw their business outgrow the farm, prompting
a move down to Johannesburg. Here they fo-
cussed predominantly on the coal mining secto
while also venturing into manganese, gold and
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44 RESOURCES p Miig Svics
platinum. Since then Trollope have specialised i
open pit mining; taking signicant loads from th
ground, drilling and blasting it, removing the roc
and stock piling the usable material.
The companys main facility is now situated
just outside Johannesburgincorporating head
ofces and workshops. There are also bases in
Thabazimbi and Jurmala. Every contract also ha
its own workshops and ofces on site.
Going global
For many years the companys biggest contract
was with Xstrata in South Africa, however, when
the crash came in 2008, some of the agree-
ments had to be terminated. Ironically it is these
cancellations that have been a catalyst for the
companys transformation.
In response to the global economic crisis
the company started to take on a greater variety
of contracts among the junior to middle min-
ing houses. Perhaps most signicantly, Trollope
started to take its operations abroad, compiling
substantial international client base, with proj-ects in Australia, Turkey, Spain and France. The
workforce has also stabilised and risen to 1,000
Managing Director Guy Hopkins explains:
The economic downturn made us look at the
bigger picture and consider the possibilities of
trading on a global scale, he says. I think in
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46 RESOURCES Trollope Mining Services
hindsight it was a good thing that we were freed
from the some of the long term contracts, as it
enabled us to pursue other options.
In the past we were far too exposed in one
single sector, with one single client. Now we have
an impressive range of clients, projects in sev-
eral different countries, a great reputation in the
industry and a steady cash ow, he added.
Promised land
Inspired by the healthy position and huge pool of
expertise within the companys ranks, there are
plans to expand within key African areas, notably
Zambia, Zimbabwe and Botswana. With the ord
book 90 per cent full there is also a solid found
tion on which to approach other ventures.
From a nancial point of view we are in an
exceptionally strong positionahead of a lot our
competitors. We probably went through the dow
turn quicker than anyone else, so we managed
to emerge from it quicker and equip ourselves
for the future, says Hopkins. Some of the othe
guys are still carrying old contracts at poor rates
at not getting the yields or protability.
During what has been a very steep learning
curve the company has also had the opportunit
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to ne tune its equipment policy. All primary
machinery must now be brand new, ensuring
it has the longest possible life span, while also
providing reliability and exceptional performance.
The result of these widespread changes is
a fresh impetus among staff whose morale is at
an all time high.
Family values
Peter and John are still very much involved in the
company and are as passionate as ever. John is
involved in the plant side, where he is currently
mentoring an up and coming manager, and Peter
is lending his considerable acumen to business
development.
We are keen to retain a family ethos within
the business, while still embracing core corpo-
rate principals, with structured systems, poli-
cies and procedures. Its about striking the right
balance, concludes Hopkins. I look at how the
business runs on a day to day basis and, while
it is very professional, it still has the spirit and
personal touch of a family business.
The biggest test for a company is how it rolls
when the punches are ying. Trollope refused to
throw in the towel and instead came out ghting
Trollopes journey is an uplifting triumph ove
adversity tale and, after doubling its turnover in
the last year, it seems like this story has many
more chapters still to be written. TAB
www.Tmsgroup.co.zA
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DeAling wiTHDeTOnATiOn D
J Di & B
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048
HeMAnD
st
resOurc
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Miig c b dgs bsissd t isks ivvd y
wt psig i stigt c is tk. Wit tis i mid it cms
dw t cmpis sc s diig d bstig spciist J Di
& Bst t tk c t pytcics d ctic dttis
qid mis t v ti idd pyds.
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52 RESOURCES J Di & Bst
wiTH A TurnOver in excess of ZAR300 million,
Jef Drill & Blast has emerged from depths of
recession, with aplomb.
In general the resources we are majorly
operating in are really on the upespecially now
that the export markets are stable again, says
Jef Drill & Blast managing director Johan Pieterse.The only thing that we see threatening the busi-
ness is the current labour trends in South Africa.
The company has a 300-strong workforce
and a very impressive staff turnover of less than
one per cent a year, according to Pieterse, who
says that despite union action and strikes dis-
rupting certain industries in South African, Jef
Drill & Blast operations look likely to continue
unhindered due to its good staff relationships.
We have a very good relationship with all
our people, notes Pieterse. But its the outside
inuence were worried about.
Within the company we are a well-oiledmachine, with things ticking over and under
control. Weve got a great consumer base, grea
people working for us, great equipment and we
are owned by a great company with great senio
management gures; so as it stands everybody
is happy, he asserts.
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54 RESOURCES J Di & Bst
A rich history
This year the company is celebrating its 21st
birthday and has, in the past two decades, built
up a colourful history.
Pieterse joined the company in 1994 and
two years later was part of a team that led a
management buyout of the rm. In 1997, JefDrill & Blast founder Peter Francis retired, at
which point Pieterse and his team took over the
running of the company.
Following ten successful years of growth, the
specialist mining rm was bought out by South Afri-
can mining giants Sentula Mining Limited in 2007.
The recession, however, was just around
the corner. Jef Drill & Blast initially struggled
through the nancial downturn, and as a result
is today ploughing much of its focus into the
coal mining sector.
Pieterse says that the company indirectly
lost business through the global decline in gold,having previously worked with clients within tha
industry and in the diamond mining sector.
We were working on projects that actually
closed down or mothballed, says Pieterse. The
fact that we suffered as well led to us to lose 50
per cent of our business in 2009 because of th
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recession; but we realised that the country needs
coal to supply people with electricity.
The company currently uses 45 specialist
drilling rigs in the opencast mining sector, and
has its operational eyes focused on the growing
coal sector in southern Africa.
Jef Drill & Blast is a key division within Sen-tula, servicing all of its opencast mining projects
as well its own expanding list of clients.
Formerly known as Scharrig Mining Limited,
Sentula has been listed on the main board of the
Johannesburg Securities Exchange since 1993.
Involved in opencast mining and rehabilita-
tion with operations in 12 countries across the
African continent, Sentula is also one of the ma
jor suppliers of outsourced mining and rehabili-
tation in the South African coal mining industry,
and has grown to become the leading opencast
coal mining contractor in the country.
With such a wealth of managerial talent toturn to at Sentula, Pieterse says that Jef Drill &
Blast has found itself in a fortunate position.
Saety rst
Working for Jef Drill & Blast may sound like fun,
but causing explosions and detonating dynamit
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is not childs play. The company deals with safety
in the most serious manner possible, notes Piet-
erse, who says safety is part of the rms fabric.
It is a dangerous business, but it is also like
driving a car, he remarks. You can do it safely if
you stick to the rules and regulations.
Safety for us is a paramount concern and
we start off with a safety perspective in every-
thing we do. We undergo a constant process of
training and retraining with our employees, in
order to keep them up to speed with the latest
safety developments, and we also try to make
it interesting for them, he adds. Safety is our
lifestyle and it is not something we enforce
with our staff.
To further push through his point about the
companys attitude towards safety, Pieterse says
that it is something the rm lives and describes
it as like a religion in our business.
Removing the hassle
In a marketplace that needs professional blast
and drill specialists in order to function, JefDrill & Blast is busy setting itself apart from
the competition.
We have been a very good service provider
in the past few years and our clients expect
us to make the customer number one in our
business, says Pieterse. We provide a unique
service and product, and its something that a
lot of mining companies cant do themselves.
We are sensible and we are able to allow
the companies we work with the chance to focu
on what they are good atminingmeaning we
can handle the earth-moving equipment.
We reckon what we can do is take a huge
hassle factor out of the hands of our customers
he stresses.
In the next few years the company is target-
ing a slow, but steady expansion, notes Pieterse
We are slowly, but surely, looking to develo
other markets and it is not a strange thing for us
to work in other sectors of mining, he reveals.
Mozambique is starting to make its mark on th
map now in regards to coal mining, as is Zambia
and the Democratic Republic of Congo, where
our sister company does a lot of exploration for
gold and coal, so these are markets were cer-
tainly looking at, along with Botswana.
Having recovered from the recession with a
bang, and having detonated a steady plan for fu
ture growth, Jef Drill & Blast looks set to embracan explosive future. TAB
JefDrillAnDBlAsT.cO.zA
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MzeAl fOr
058
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sAMBiAn cOpper
resOurce
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60 RESOURCES Mis Ic.
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I 2005 d 2006 aic ribw Mis
(arM) limitd, St aic divsid
miig d mis cmpy, istd its -
St aic xpti ssts t t
Stck excg tg expti d
Miig Icptd (). I 2009 wig
t distig , V S.a (V), Bzii
divsid mtiti, cqid 50 p ct
Mis (Bbds) Icptd (t
cmpy).Tis ws t bgiig t V/
arM jit vt (V/arM JV) tt wd
s t pts sig t jit vt t cs
cpp miig i St aic.
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62 RESOURCES Mis Ic.
since THen, THe Vale/ARM JV has progressed a
number of exploration and extraction projects in
Zambia and the Democratic Republic of Congo
(DRC). The companys strategy is being driven
by its joint-venture status and its decentralised
business philosophy, according to senior general
manager Edward Legg.
The company leverages on technical and
corporate support from both joint-venture share-
holders and therefore accesses world best prac-
tical practice, remarks Legg.
The group currently employs approximately
250 staff, the majority of whom are drawn locally.
Its current key focus in Zambia is to develop
Phase 1 of its Konkola North Copper Project which
aims to produce 45,000 tonnes of copper from
2.5 million tonnes of ore per annum and has a
life of 28 years. Phase 2 of the project, which will
follow once studies are complete and has received
shareholder approval, will increase production to
100,000 tonnes of copper per annum.
Legg says: The climate for investment in
Zambia is very attractive due to the presentgovernments approach to expanding opportuni-
ties for investment.The company expects the rst
phase of the Konkola North Copper Project to
employ approximately1,500 people at full pro-
duction, of which 95 per cent will be Zambian. At
present it has approximately 1,400 contractors
on site for the development phase, which will
increase to a total of 2,000 the majority of whom
will be Zambian.
The Vale/ARM JV is also active in the DRC,
where Legg says the climate for investment has
improved due to infrastructure and service im-
provements.
In both the DRC and Zambia, the company
has local partners, being the state-owned min-
ing companies Gcamines and ZCCM-IH, heremarks.
Development plans and an aggressive
approach
The joint venture is currently developing the
rst phase of the Konkola North Copper Project
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64 RESOURCES Mis Ic.
which will produce 45,000 tonnes of copper in
concentrate per annum from its underground
mechanised mine in Zambia.
It has also undertaken an extensive drilling
campaign in the remaining area of the mining
licence, where it expects to develop Phase 2 of
the project which will be of similar magnitude in
three to ve years time, notes Legg, who adds
that the Vale/ARM JV also has other exploration
projects in Zambia.
The company is also nalising a pre-feasi-
bility study for the development of an open cast
mine in the DRC, remarks Legg. Gecamines is
a 40 per cent partner in the Kalumines Project
with the Vale/ARM JV and there are also addi-
tional potential exploration targets in the mining
licence area.
We are aggressively addressing both of
these projects, he adds.
The execution of the rst phase of the Konko-
la North Project development, which includes the
underground infrastructure and the construction
of a processing facility at the mine, is underway,representing an investment of approximately
US$400 million, according to Legg.
In-ll drilling in the target area for the sec-
ond expansion phase has commenced and the
study for this investment will follow the resource
clarication.
Legg also points out that a pre-feasibility
study on the Kalumines Project in the DRC is
underway.
This anticipates the development of an
open-cast mine to process oxide ore in two phas
es, he explains. The rst phase is a concentra
tor, which will be followed at a later stage by a
solvent extraction and electrowinning renery.
In addition to these projects, the company
is also undertaking exploration at its mine sites
as it looks maximise all the opportunities it has
been presented with in the two African countrie
Community care and a ocused uture
The Vale/ARM JV has established a series of Co
porate Social Responsibility (CSR) programmes
at each of its operations designed to meet the
needs of local communities. At the Kalumines
Project in the DRC and Konkola North Project in
Zambia, the company is focusing on infrastruc-
ture, primary education, agriculture and health
initiatives.
Legg notes: The initiatives at Konkola Nortare currently being readdressed with the comm
nity due to the development of the mine.
We are anticipating a potential resettlemen
of residents in the affected area, which will resu
in infrastructure upgrades in the enlarged Konk
la village. During the economic downturn in 200
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the company was forced to resize, but now is well
positioned to take advantage of the increased
demand for copper, notes Legg.
Alongside its CSR initiatives, the Vale/ARM
JV also has in place an environmental program
to monitor and mitigate the impact of its mining
and exploration activities.
Both joint venture partners monitor theircarbon footprint, and therefore the company
subscribes to the same values, Legg remarks.
We adopt Equator Principles with respect to en-
vironmental management and the social impact
of mining.
In the coming years the company is looking
to take advantage of its projects as they come
online and in some cases enter full production,
according to Legg.
The company expects Phase 1 of the Konk
la North Copper Project to reach full production
within the next four years, and Phase 2 to be we
into the development stage in that time period,
he says. But moving forward, we will continue taddress the expansion of our footprint into the
Southern Africa copper business.TAB
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66 RESOURCESBeacon Hill Resources
MOzA
Big plBc hcmpy Mzmbi
066
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Biques
yerrscs is tid mc s c sty
resOurc
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68 RESOURCESBeacon Hill Resources
Wit gb st pdcti tippd t
ics t 1.5 bii ts i 2012, its i
t sy tt mis w v gt i y d
scd tp pjcts i t igt ctis, i gd std t sb. Ts w
v mgd t t Mzmbic pjcts
it ti ptis mgst t bst,
d t w tt v ctd s st-mvs
twds cig -tm pdcti i
t gi t mst ppdd .
o sc cmpy, my td gb
by ists wit tw pimy ssts tt t
y ivsts bi, is Bc hi rscs
Pc (lon:Bhr); t cmpy i pssssi
xcitig mgsit py i twst
smi (t at Mgsit pjct, wit
JorC cmd sc 39 mii
ts tck t cmmc sibiity
i 2012) d t Mis Mtiz ckig
c mi i t, Mzmbiqt y
ptig mi i t ckig c dstiti
cic (JorC sc 80 mii ts,
mib sc 57 mii ts).
since rAising Afurther US$20 million in funds in
April, Beacon Hill has been particularly busy. From
its recently completed Phase 1 drilling programme
at Arthur River, to readying for coal export from
Minas Moatize, there is a lot to prepare for. Minas
Moatize is on track to commence coal exports from
the second quarter of this year. Arthur Rivers scop
ing study continues in full swing, taking the projec
towards full feasibility and nding the right partner
for future success. In the words of Justin Lewis,
Chairman, weve been going hell for leather.
First in ete
As the company at the helm of the only operat-
ing coal mine in Tete to date, BHR is in the mids
of some incredible investment and expansion.
Neighbours Vale and Riversdale Mining are
going about building two of the worlds largest
coal projects, commanding new deepwater port
facilities, rail refurbishments, river barging, wor
forces and everything else needed to quite liter-
ally re-landscape the region as a mining hub. As
a result, Lewis explains, it has been important
for BHR to uphold the political importance of th
Minas Moatize mine and understand what its
successful production means for the province a
this stage of its overall development.
We [are] currently producing what are fairlysmall amounts of coal, ve to 10,000 tonnes a
month. Since we acquired the mine a little over
a year ago weve pursued a twin track strategy:
rstly to continue production from the existing
mine, he says.
Mozambique wants it to continue to produc
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70 RESOURCESBeacon Hill Resources
and weve refurbished it [to do so]. Also in terms
of our overall strategy, its important for us to
maintain our rst mover advantage, particularly
in securing access to the logistics.
In parallel with this strategy, BHR has been
working to develop a larger open pit mine aimed
at producing approximately 4 million tonnes a year
run-of-mine and 2.35 million tonnes a year of sale-able coal, with about one million tonnes of that
made up by coking coal. The miner has already
completed drilling across the entire project, tak-
ing the whole mineable resource from 25 million
tonnes to 57 million tonnes, and in effect more
than doubling the mine life from eight years to 15.
Were on course to be in production from
the rst quarter of next yearsimilar timelines t
Vale and Riversdale, Lewis says.
As part of existing production, weve also
just completed the installation of a small wash
plant which will have capacity of about 120
tonnes an hour, or if you ran it at full pelt about
million tonnes a year.During the next 12 months leading up to open
ing the larger open pit, BHR will produce exportab
grade coal with these facilitiesperhaps even by
the beginning of July. This plant will meet the proj-
ects requirements until the larger pit comes into
play, and the company will construct a larger wash
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Communicaons provider to Beacon Hill and Randgold Resources
plant in time for that, with a capacity of about four
million tonnes a year, by early to mid-2012. In ex-
amining the way Minas Moatize and BHRs related
infrastructure will expand, and looking at the wider
regional requirements of the many setting up shop
in Tete, it becomes clear quite how important it is
that BHRs core project continues to develop: It is
through following Minas Moatize that a lot of Tetesfuture mining will take place.
More coal, more access and growth or
BHR
Whether youre a new arrival, old hand, large proj-
ect planner or minor involvement party in Tete, it
appears that general consensus for future coal
exports trends towards going via rail-to-port. Lewis
says that BHRs long-term ambitions are the same
focused on transporting its coal to the port of Beir
and couldnt be better timed given the plans for
upgrades and extension work taking place.
Importantly, were looking at exporting a max
mum of about two million tonnes a year of coal,and most of that will end up in India. For us, Beira
can be a long-term solution because although its
a shallow port, and exporting coal to India that on
tends to have shallow ports too, he says.
[Other larger project companies] need to
be able to load direct onto cape-size vessels,
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72 RESOURCESBeacon Hill Resources
particularly when they get up to large volumes,
and thats why theyre looking at developing othe
ports. In the short-term were also about to com-
mence trucking coal to Beira any day now.
With the railway line slightly behind schedul
with refurbishments taking place up until Sep-
tember-December this year, BHR has a 500,000
tonnes per annum trucking plan in place to
commence initial export quickly; a little more
expensive than using the rail straight away, but
as Lewis says, with coking coal you do have quit
a lot of margin in what youre doing. Of the fund
raised in April, about half has gone towards the
Tete logistics chain, in keeping with the compa-
nys ability to move quickly and retain rst-move
advantage. At the same time as this balance of
funds, the company entered a Memorandum of
Understanding (MOU) to acquire an additional l
cense area nearby named 1165 (1165L), abo
40 kilometres east of Moatize.
We think its an interesting one because it
in the Moatize Basin where known coking coal e
ists, its surrounded on three sides by Riversdaland on one side by another license area with
a known billion ton coking coal resource on it,
Lewis says.
Theres an estimated resource of about 40
million tonnes of coal, although thats a non-
JORC estimate by the vendors. The MOU allows
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us to acquire that area for $42 million, so $10
million of the funds raised provides the equity
portion of that and were in the process of nal-
izing that acquisition and its debt funding.
Once again, the group has used its initial po-
sition to expand and gain greater access to more
coal. By bringing its holding into production in
conjunction with expanding upon its logistics, it is
poised to develop an ever more signicant-size of
operations.
Clearly in terms of Beacon Hill, it turns us
from what might be seen as a fairly niche player
with an operating mine into a strategic player in
the region with a combined resource of north of
500 million tonnes, Lewis says.
We think that puts us in a better position than
someone coming in three or ve years time.
Still moving rst
At the earlier stage Arthur Magnesite project in
Tasmania, BHR is about to nalize the scoping
study. Lewis says that critical licensing has been
put in place and a small drill program alongside thenow-complete study will run until August/Septem-
ber. At that stage, the company will begin looking
at developing a project and going about nding the
right partner in the process. On track for production
within 24 months, it appears that Arthur Magnesite
may well be BHRs next success storyafter Minas
Moatize and global appreciation of Mozambican
coal industry, of course.
Ive been in and out [of Mozambique] in th
last few years, and its developed enormously.
The speed of change in the last few months
makes you very hopeful about the next 12
months, Lewis says.
We sit right in the middle as the only produ
ing mine and have many strategic advantages,
giving us a great platformand demonstrating
to some extent 1165 and growing and adding to
thatand also it makes us an exciting potential
opportunity to other people who might want a
foothold in this region.
BHRs imprint on Mozambiques growing co
industry has and will be incremental to its futur
success. In addition to getting in rst as a com-
pany and prospering from that, it has provided
many of the building blocks that will open the
region up for future activity. In a matter of days
the Minas Moatize mine will commence export,
offering a vital new source of coking coal as
global demand from the steel industry continueon strongly. The Arthur Magnesite project will be
the next chapter, and given the way the Mozam-
bique episode already reads its going to be a
very exciting story. TAB
www.BHrplc.cOM
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creATing An
Business Hu
074
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fricAn
Municip
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76 MUNICIPAL City Cp w
Cp w ctis t bid d dvp,
wic t sm wd sm spisig
csidig it is y y t t city
pyd g d smwt xpsiv i stig t FIFa Wd Cp, d
tt t wd is sti cvig m
cssi.
BuT fOr sOuTH Africas second city, infrastruc-
tural projects and property developments are
moving ahead, and in many ways because of the
work of the citys municipal authority.
Andre Human, who is the manager for acqui-
sitions and disposals for the City of Cape Town
municipality, says of his role: I buy properties as
required by the city and also sell properties no
longer required by the city. The City is continu-
ing with the expansion of its public transport
project (BRT) and there are also a number of
bulk infrastructure expansion (roads, sewer and
water) projects that require the acquisition of
land by the City. With regard to the sale of proper-
ties, there is still opportunity to selectively placeproperties onto the market for developmental
purposes.
Human says the City of Cape Towns mission
statement is rst and foremost about trying to
be an effective administration with a well-main-
tained and managed asset base.
What my department does is to ensure that
we put our properties to the best use, Human
explains. We also rent out some of properties and
we have a rental portfolio worth about R55 million
We also sell properties to NGOs or we re
properties to support community and social
work such as crches, religious site and those
kinds of things.
In taking vacant sites across the city and trans
forming them through public-private investment
projects, or through sale to private investors, Hu-
mans department is playing a very important role
in Cape Town, ensuring that the sites no longer
required by the Citys authority are put to good use
A role in society
The money raised comes back into the cof-
fers of the city, Human says of plot sales made
by the department. Sometimes some of the
income is offset against infrastructure improve-
ments such as roads, electricity, or bulk public
upgrading, for example.
With its work with NGOs and local charitiestaken into account, Human says that he under-
stand the public value of his departments work
We play a very strong social role in terms of
our properties and we also have an economic role
he notes. This economic role is especially true in
our previously disadvantaged areas, where our cit
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has sold properties in order to create job opportuni-
ties and investment opportunities.
Weve also created quite a lot of retail and
housing development opportunities, which we
facilitated by getting developers on board in a
partnership.
One such example, cites Human, is that of
Khayelitsha Mall, a 17,225 metres squared retailcentre in the Khayelitsha Central Business Dis-
trict (KBD), which has bought business activity to
an area that was in dire need of investment.
Developed at a cost of R86.5 million and
ofcially opened back in November 2005, the de-
velopment of the retail centre was a partnership
between the City of Cape Town, the Khayelitsha
Community Trust and Rand Merchant Bank.
The centre was originally occupied by 51
retailers, but had to be immediately expanded
due to a high demand for trading space; by June
2006, an additional 2,000 metres squared of
retail space had been constructed, bringing the
total cost of the development to R110 million.At the moment, the department is busy wor
ing on the expansion of the citys conference
centre, in a project designed to strengthen Cape
Towns appeal among business tourists.
Each of our projects has a different focus
and strategy, and although our primary focus is
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78 MUNICIPAL City Cp w
on upgrading and uplifting our own communities,
there are also projects that are aimed at bring-
ing people into our city and thereby to strengthen
our tourism sector and create employment to our
people, says Human.
With much help from Humans department
in terms of land acquisition and investment,
the Cape Town International Convention Centre(CTICC), the continents most successful con-
vention venue, is currently planning a massive
multi-billion rand expansion that will include, in
collaboration with the provincial government and
the private sector a new hotel, private hospital
and retail facilities.
Situated along the beach in Blouberg, the
department also had a huge hand in bringing th
Big Bay development to fruition.
The land was sold by the City on public te
der to various individuals and developers and
the property was packaged (zoned, subdivide
bulk services provision, etc.) in a partnership
arrangement between the City and develop-
ment rm Rabcav.
The development consists of 450 single,
500 group housing and 395 sectional title
units, as well as 10,000 metres squared of
commercial development and a mix-use deve
opment incorporating retail, restaurant, ofce
and residential units.
Another notable development it has been
involved in is the Galleria Developmenta R1
billion 110,000 metres squared mix-use deve
opment in the Tyger Valley area of the city. As
part of the transaction, the developer Devmet
Properties will also manage and maintain
Council-owned facilities located on an adjace
property.
Downturn and duty
Of the recession, Human says that Cape Town
certainly felt the pinch.
We had a number of projects that were
not successful in the sale, but there are still
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opportunities, he notes. In previously disad-
vantaged communities where there had histori-
cally been very little investment, there are still
opportunities, and we have found ourselves
concentrated on these opportunities.
What is diferent in our role
compared to a private sector
companys role is that or us its
not only the bottom line, he
enthuses. In Cape Town where
we have quite diverse communities,
including some very rich and some
very poor, one has to take into
consideration these elements, and
while we have learnt many lessons
along the way, we have continuedto improve the service were
ofering.
Human says that he has been very fortu-
nate to have been working in his eld for the
past 20 year, and is grateful of the chance to
have played a role in facilitating such an ofce.
There is certainly the chance of spreading
such a concept as our department out to other
municipalities across South Africa, he enthus-
es. What we do is very much internally orien-
tated in terms of looking for opportunities for
Eris Property Group isproud to be associatedwith the City of CapeTowns ongoingdevelopment initiatives
www.eris.co.za
Tel : (011) 775-100
our local people and creating social prospects
and facilities through the proper utilisation of
the Citys assets.
With this in mind, along with the local gov-
ernment authoritys commitment to making the
most of the investment and development oppor
tunities available to it, it is surely only a matter
of time before the model of the Citys property
management department is replicated in munic
palities across the country. TAB
www.cApeTown.gov.zA
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pArSt aic
Jit vts t Sttt pivt d pb
0
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lifenti Pks
c nti Pks pvts c iv i my
0
MunicipA
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82 MUNICIPAL SanPks
wHile MAn HAs crafted some impressive specta-
cles in the last few centuries, it is Mother Nature
that still remains the most accomplished and
envied architect.
Among her nest achievements are the intri-
cately sculptured landscapes, captivating pan-
oramas, vivacious vistas and awe-inspiring wild-life of South Africas National Parks (SANParks).
It is perhaps tting that a country whose history,
vibrancy, colour and diversity resonates so pro-
foundly in this majestic region.
Every year thousands visit the parks hoping to
set eyes on the cornucopia of spectacular wildlife.
All manner of creatures, including lions, leopards
elephants, rhinoceros, buffalo, various antelope
and baboons, still traverse the stunning terrain,
allowing visitors a truly unforgettable experience
Partners
In recent years SANParks has been expandingits operations through its Public-Private sector
partnerships (PPP) involving eco-tourism, as
dened in the Public Finance Management Act
(PFMA) regulations. These initiatives include th
provision of accommodation, restaurants, retail
platforms and activity-based projects.
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84 MUNICIPAL SanPks
The exciting development of PPPs have al-
lowed SANParks to boldly branch out into new
markets, improve efciencies, create valuablejobs and have a much wider product range.
While lodge concessions have allowed SANParks
to venture into ve-star luxury catering for the
eco-tourism market and, with good conserva-
tion management, draw experts in several elds.
The accommodation options have also been
increased by the Golden Kudu initiative which
offers concessions, making sure the parks can
be experienced by people from all walks of life.Within the lodge concessions, environmenta
management is very stringentlike establish-
ing exactly what the optimal water consumption
should be. This productive brand of environmen
tal management meets the highest expectation
in the industry.
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With such a seductive product it is easy to
see why SANParks has also formed some equally
fruitful relationships with private sector organ-
isations, including construction companies and
architects. This exibility reinforces its dynamic
outlook and has a noticeably positive impact on
to the local economy.
Progress
In addition to tourism, accessibility has rapidly
increased, with about 500 extra top-of-the-range
beds for customers. The shops and restaurants
have