MOKOPANE, SOUTH AFRICA – Anglo American Platinum’s bid to appease a community near its most profitable South African mine may unravel, highlighting the challenges of managing flashpoints of social unrest while trying to shore up its balance sheet.
The world’s largest open-pit platinum mine, Mogalakwena was shut for two weeks last year when residents of the surrounding shanty towns rioted, protesting against the government’s failure to provide services and the mine’s failure to provide jobs.
In April, Amplats announced a deal to set up a 175 million rand ($11 million) community trust for the local Mapela tribe to kick-start development and investment in neglected villages. The trust’s aim is “to improve the living conditions and quality of life of members of the Mapela Traditional Community”.
“It is the crown jewel in the portfolio and so managing risk and community relations around the asset are very important,” said Hanre Rossouw, fund manager at Investec Asset Management, which holds shares in Amplats and Anglo American.
But the gesture has been greeted with anger by some residents, who say the amount is too little and complain that while their traditional leader was consulted, communities were not.
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