The role of Black-owned SMEs in transforming South African mining

In his address at the 2026 Investing in African Mining Indaba in Cape Town recently, the Minister of Mineral Resources, Gwede Mantashe, said that the government is committed to creating a regulatory framework that attracts investment while ensuring that the benefits of the country’s mineral wealth are shared equitably with all South Africans.

However, clauses related to the imposition of Black Economic Empowerment (BEE) requirements in mining exploration were removed from the draft Mineral Resources Development Bill (MRDP).

Mantashe assured that this is not a “retreat from transformation” or an endorsement of the view that “Black participation is a barrier to economic growth”.

Nabeela Vally, head of business development at Edge Growth, spoke to Bizcommunity about the role of Black-owned SMEs in transforming South African mining.

Left to right: Fana Mnguni, Noluvo Nela, Nabeela Vally and Tiyani Masingo from Edge Growth at this year's Investing in Africa Mining Indaba. Image supplied.

Is it possible to reach BEE targets within mining and boost investment opportunities?

Yes, it is possible, but only if transformation is treated as strategic rather than perfunctory.

This year’s Investing in Africa Mining Indaba emphasised that partnerships across government, industry, communities and financing partners are critical to unlocking inclusive economic outcomes.

The event’s theme, “Stronger together: Progress through partnerships”, reflects this reality: Complex agendas like transformation require alignment across stakeholders, not isolated compliance.

From an investment perspective, transformational pipelines that incorporate ESG principles, local participation and supplier development strengthen investor confidence, expanding capital flows into mining ventures that demonstrate real socio-economic impact.

This means BEE targets should be embedded into investment readiness criteria, deal structures, and project viability assessments.

Why is there so much pushback on the matter of transformation?

Pushback arises because transformation is often framed as a cost or regulatory burden rather than a strategic growth driver.

Historical tensions include:

• Fear of increased costs and reduced competitiveness in a global market where margins are tight.
  
• Concerns over capability gaps, where locally empowered partners are not always operationally or financially ready.
  
• Simplistic implementation models that focus on ownership percentages rather than real economic participation.
  
• Misperceptions that transformation and competitiveness are mutually exclusive.

In reality, this year’s indaba messaging and industry discussions suggest that transformation and competitiveness must co-exist if mining is to support growth, jobs, and investment sustainably, but this requires intentional design, capability-building, and genuine partnership rather than box-ticking.

Mining

#JoburgIndaba: Can mining growth and transformation co-exist in South Africa?

Maroefah Smith  9 Oct 2025

Can mining growth and transformation co-exist in South Africa?

Absolutely! The Mining Indaba’s overarching theme is that inclusive growth and transformation are mutually reinforcing, not contradictory.

Growth creates opportunities for dynamic, scalable SME participation; transformation ensures that the benefits of that growth flow into historically disadvantaged groups.

However, co-existence depends on integrated approaches aligning transformation programmes with business strategy, capital flows, and operational realities rather than treating them as separate policy add-ons.

When transformation is integrated into value chain expansion, procurement strategy, local manufacturing, and investment models, both goals flourish together.

Should the draft Mineral Resources Development Bill (MRDP) have BEE-related clauses specifically for mining exploration?

Yes, but with nuance. Exploration is not just an entry point; it’s a pipeline for real industrial participation by Black-owned firms.

Having BEE-related provisions in the MRDP could create clarity and incentives early in the mining lifecycle, signalling that transformation begins at the earliest stages of value creation.

But mandates alone are insufficient; what matters is how those clauses are designed:

• Must be practicable (reflecting exploratory risk and capital cycles).
  
• Must embed capacity support, not just ownership percentages.
  
• Should incentivise value creation, not just title transfer.

Effective regulation should align transformation requirements with investment certainty so that the bill supports competitiveness as well as inclusion.

Mining

#MiningIndaba: Is South African mining ready for the skills of tomorrow?

Maroefah Smith  12 Feb 2026

Exploration is one entry point for Black-owned businesses; enterprise and supplier development (ESD) is another. How can ESD work as a growth engine for Black-owned businesses across the mining supply chain?

ESD must be strategically structured, contextualised, and partnership-driven to function as a growth engine.

A few key principles from current industry insights:

a). Align ESD with real operational demand. ESD should connect SMEs to actual procurement requirements, not hypothetical quotas. When SMMEs understand exactly what mines need – quality, timing, standards – they can scale.

b). Expand beyond financial support.

The most effective ESD programmes combine:

• Market linkage and procurement access,
  
• Business coaching and operational upskilling,
  
• Quality assurance and standards readiness,
  
• Capital access tailored to real cash-flow demands.
  
• Mining Weekly analysis shows that most ESD programmes fail because they don’t replicate real operational readiness and lack sequencing. Instead of increasing spend, design programmes that reflect the practical realities of mining supply chains.

c). Use partnerships and clusters

• Mining Indaba emphasised organisational and value chain partnerships blending OEMs, local manufacturers, miners, and financiers to close capability gaps and unlock industrial co-development.

d). Leverage demand predictability

• Where mines share forward-order books with ESD recipients, SMEs can plan capacity expansion, capacity investments, and workforce development more efficiently.

Sustainability

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What is the key to strengthening ESD programmes to support Black-owned SMEs in helping them become scalable suppliers to mining houses?

There are a few core elements that differentiate strong ESD programmes from weak ones:

a). Demand-led design, rather than supplier development being driven by spend quotas, programmes must be demand-led and co-designed with procurement teams in mining operations. When SMEs learn exactly what buyers need, they can tailor quality, delivery, and compliance.

b). Capability upliftment, not just capital support, should cover:

1. Technical skills.
   
2. Quality standards.
   
3. Compliance.
   
4. Business management.
   
5. Financial literacy. Without capability uplift, even funded SMEs fail to sustain supply contracts.
   

c). Integrated performance measurement. Instead of counting spend, measure:

1. Supplier retention.
   
2. Repeat orders.
   
3. SME revenue growth.
   
4. Job creation.
   
5. Quality performance. These outcomes matter far more than percentage spend figures.
   

d). Structured pathways to scaling strong programmes create tiered development pathways from micro-enterprise support to readiness for major contracts with milestones, accountability, and regular evaluation.


e). Institutional partnerships: Effective ESD programmes pair industry players with development finance, accelerators, and universities to strengthen the ecosystem that supports SME scaling.

Transformation and growth are aligned when they are strategic, not regulatory afterthoughts.