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Mine closures in South Africa have cost tens of thousands of jobs. In the town of Welkom, unemployment is estimated at about 60 per cent. (SIPHIWE SIBEKO/REUTERS)
Mine closures in South Africa have cost tens of thousands of jobs. In the town of Welkom, unemployment is estimated at about 60 per cent. (SIPHIWE SIBEKO/REUTERS)

South African gold town struggles to find a future Add to ...

In its 1980s heyday, the Oppenheimer Park Golf Club boasted about 1,300 members and hosted some of South Africa’s premier tournaments. Today it has 300 members and its chances of welcoming top players are bleak – four of its holes are submerged beneath the polluted waters of an adjacent lake.

It is a decline that reflects the fate of Welkom, the sleepy town where it was built, which was a core part of South Africa’s gold industry at a time when the nation provided about two-thirds of the world’s precious metal.

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As its mines close, Welkom is struggling to carve out a new future. Unemployment is rampant and the local authority is criticized for incompetence and mismanagement.

“At the moment we are in a survival phase and unless we get rid of all the political interference and ineffectiveness it’s going to be a battle,” says Aubrey Nyschens, a businessman who moved to Welkom as a “pioneer” in 1950. “The town must change, it must move.”

Joblessness, poverty and inequality are ailments that afflict the whole of South Africa and tackling the so-called “triple evils” is to be a prime focus of the ruling African National Congress’s five-yearly policy conference in June.

In Welkom the challenges facing both party and nation are apparent.

The town sprang up at the end of the 1940s with the discovery of gold, and the country grew on the back of its mineral riches.

The town’s planning was overseen by Sir Ernest Oppenheimer, then chairman of Anglo American, the mining company. At their peak the area’s mines produced about 200 tonnes of gold annually and employed more than 130,000 people, local officials and mining experts say.

As mines have become deeper and more expensive to operate, South Africa’s gold sector has declined sharply, with national production falling from about 1,000 tonnes in 1970 to about 200 tonnes in 2010. And Welkom has been among the worst affected areas. Mine closures have cost tens of thousands of jobs, with locals putting unemployment in the town at about 60 per cent – more than double the national rate.

Harmony Gold still operates nine mines around Welkom and mining remains the town’s top employer. But the decline in gold will continue unless new technologies are developed that will extend the lives of mines.

Welkom’s businessmen and politicians talk of the town’s non-mining potential: Its central location means it could become a logistics and transport centre. Yet there are complaints about missed opportunities and the lack of a clear economic plan. Many blame Matjhabeng municipality, under which Welkom falls.

“They do not know how we are living, they just increase the rates,” says the owner of a township bottle shop, who does not want to be named for fear of repercussions. “When it [the decline]started it was like quicksand – we didn’t realize we were sinking and we are under.”

An auditor’s financial statement for the municipality in the year to June 2010 cited 918-million rand ($115-million) in unauthorized, wasteful and irregular expenditure.

Since taking power in 1994, the ANC has struggled with human capacity issues as it has made the difficult transition from years as an underground liberation movement to governing party.

Critics say the problem has been exacerbated by its cadre deployment policy, whereby ANC members have been put into positions of power often based on their party affiliation rather than merit.

It is at the local level that the problems are often most acutely felt. The Treasury says 66 municipalities around the country are in “financial distress.”

“Even if the municipality doubled its income … it would still be broke because of mismanagement,” says Raff Moretti, a businessman and member of the local chamber of commerce. “People want to be associated with winners. No business wants to come to a place where there’s these problems.”

Bheke Stofile, a municipality official and former mine worker, says Welkom’s woes reflect a lack of planning by both the apartheid regime and the ANC, adding that mining houses could also have been more supportive of development.

The situation is unlikely to improve this year as the ANC, plagued by factionalism, gears up for a December conference where its top leaders are up for election. The wrangles at the top, with speculation that President Jacob Zuma could face a leadership challenge, have filtered down to local levels.

“We need to have political stability to do what we need and at the moment with the conference, that stability is lacking at local, provincial and national [level]” says Mxolisi Dukwana, a former provincial official, lamenting the likelihood that addressing the travails of Welkom and other towns like it will be deferred yet again.

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