Guest Post: ALL ROADS LEAD TO MODIKWA

ALL ROADS LEAD TO MODIKWA … THE DEVELOPMENT JUMP OF CAPITAL
By Dale T. McKinley & Ahmed Veriava*
(Published as – “Singing the Maandagshoek blues” – Business Day 2nd August 2007)

The Maandagshoek community, nestled in a valley just outside Burgersfort (a booming mine town that straddles the Mpumalanga-Limpopo border), is theoretically one of the richest places on the planet. But here, where platinum rises up from the bowels of the earth to empower a new breed of capitalist, the people of this valley still wait for the illusive dream of a ‘better life’ for all’.

In the heart of Maandagshoek, lies one of South Africa’s most profitable mines - Modikwa Platinum Mine - established in 1999 as a joint venture between Patrice Motsepe’s African Rainbow Minerals and Anglo Platinum. While publicly presented as the poster child of a Broad Based Black Economic Empowerment (BBBEE) that supposedly marries capital investment with the meaningful development and empowerment of the surrounding community, the reality is that Modikwa is a classic case of a different kind of BBBEE – Broad Based Black Economic Exploitation.

In theory, Modikwa is supposed to represent the kind of capital investment – in this case, in a ‘historically disadvantaged’ rural community – that brings with it the full spectrum of associated developmental benefits (i.e., social, economic, cultural etc.). However, the key assumption underlying this theory – that invested capital will flow down into, and through, the community – is a chimera. As well-known political economist James Ferguson points out in his recent work on globalised capital, “the movements of capital cross national borders, but they jump from point to point … (they) do not cover the globe, but connect discrete points on it. Capital is globe-hopping, not globe-covering.” When placed within the context of the core rationale for the South African state’s overall approach to socio-economic development – i.e. that the state should not deliver directly but rather pursue development through the facilitation of private capital investment – the results of the kangaroo character of larger-scale capital investment becomes all too apparent.

In rural areas of South Africa, like Maandagshoek, the nature of the capital investment is most always a mining operation, so it is the mine that effectively takes the place of the state. Such developmental substitutionism is further enhanced when the mining operation comes with its initial BEE credentials, and with the promise of further BBBEE initiatives to benefit the surrounding community, as is the case with Modikwa. Residents logically orient towards the mine and it is the mine which then becomes the central focus of the community’s and, by proxy, the state’s developmental expectations.

In order to ‘meet’ such expectations, Modikwa quickly rolled out its BBBEE programme in the form of two Section 21 companies and a host of so-called ‘developmental’ companies. Ostensibly designed to establish ‘joint-ownership’ of the mine with the neighbouring community and to provide job-creation through the mine’s subsidiary activities, these BBBEE efforts just as quickly ‘disappeared’ down the proverbial mine-shaft. As the Maandagshoek Development Committee, the only body that can legitimately claim to represent the collective interests of the Maandagshoek community, recently stated in a letter to ARM’s CEO, K.S. Mashalane: “The section 21 companies are toothless powerless and unaccountable, they are controlled by the mine which has a complete monopoly over knowledge and skills. The companies are not at all independent and they only function through ARM’s management and control.”

These are not idle allegations by a minority group of trouble-makers, as ARM management has, with such self-assured dismisiveness, repeatedly claimed. After spending nearly two weeks in Maandagshoek interviewing a cross-section of community residents, it became clear that the overwhelming experience/feeling is one of complete anger and disillusionment with Modikwa and its BBBEE initiatives. The recent wave of vigorous and hostile community opposition to the way in which they have been treated by Modikwa, as well as to other exploratory mining operations in the area – opposition which has included the burning of mine equipment and active mobilisation around Modikwa’s conscious efforts to divide and confuse the community through its patronage of some local chiefs and politicians – provides ample evidence.

The practical, developmental inheritance of Modikwa’s seven year-old investment residence can be ‘seen’ everywhere. Where there are decent roads, all lead to the mine – the rest are little better than widened cow tracks. Many of the piped water points installed by the mine, accompanied by Modikwa-built water towers emblazoned with the ironic moniker ‘Modikwa Cares’ – and which are supposed to be within a 200m reach of all residents – no longer work and large numbers of people still access their water from polluted streams, which they share with their animals. Many houses are straining from cracks caused by explosions from mine operations. Previously plentiful grazing lands have either been taken over by the mine or are slowly dying from incessant environmental degradation. Community residents working for the Section 21 companies are paid a casualised pittance. One such resident we interviewed, who works as a full time, qualified winch operator at the mine, takes home R1200 a month.

The reality is that the local community, for Modikwa’s capitalists, is completely peripheral to the logic of their investment schema – i.e. making as much money as possible and spiriting it away as fast as possible. The elusive promise of co-ownership, meaningful job creation and trickle-down development for the community, held out by Modikwa’s BBBEE initiatives, is all the more illusory precisely because the community has no real status in the investment cycle, other than as a politically convenient bit-part actor. It is a role that neatly fits with the state’s developmental discourse – where private capital investment becomes the conduit for the realisation of social citizenship – and in which the state progressively abdicates from its responsibility to provide a minimum level of social security to the population.

Remember the name Maandagshoek. There can be few places in our country in which the ‘development jump’ of capital represents the degree to which what is left of the social, economic and cultural well-being of poor, rural communities is being systematically destroyed. And remember the name Modikwa – it could soon come to represent the ‘world class’ symbol of South Africa’s developmental path.

* The authors are presently conducting research entitled – ‘Forgotten Voices in the Present: Post-1994 Oral Histories from Three Poor Communities in South Africa’ – through the South African History Archive. The article is a product of the first phase of this research project.