Junior mining is being considered as a special case by the powers that be, who are advocating an approach of juniors making special representations, which sounds like the authorities have run out of ideas.

Certainly, junior mining is not going to get off the ground if it has to bear the heavy burden of the proposed new Mining Charter’s multipli- city of obligations that even the mining majors cannot cope with.

Startups in junior mining are acknowledged as being hugely challenging in every mining jurisdiction in the world, which is why special incentives have been put in place in countries like Canada, where there is the successful flow-through tax incentive scheme.

South Africa has introduced Section 12J of the Income Tax Act as a way of incentivising mining, but, as can be seen from the uptake, every area bar mining seems to be benefiting from 12J.

Its use in exploration, for instance, is not being pursued.

An innovative approach is needed and heads should be put together, with the Council of Geoscience and investors possibly dealing with different parts of the country differently.

For instance, junior coal mining companies starting up in the coalfields of Witbank could be looked at completely differently to junior startups exploring under the sands of the Kalahari.

The coalfield startups could likely bear the load of full transformation, while the explorers under the sands of the Kalahari could be allowed to be exposed to full risk and full reward.

In between, there could be areas where juniors can be invited to bid for exploration rights.

But one thing is already patently clear: emerging miners at exploration level in most instances need to be given certain exemptions from charter requirements, otherwise a junior sector will never develop in this country.

Even Minerals Council South Africa, which in the main represents the mining majors, has pleaded the case of smaller companies that are less capable of dealing with some of the imposed costs and challenges related to the implementation of the charter, including being faced with prolonged regulatory delays and the expensive and tortuous licensing red tape.

Canada’s approach has been very supportive of juniors listing on open public markets, which is why there are more exploration and mining companies on the Toronto Stock Exchange than on any other securities exchange anywhere in the world.

The North American country attracts investment in these juniors by allowing the investors to write off their investments against their tax.

For reasons that have not been publicly explained, South Africa’s taciturn National Treasury does not like investors owning public market shares and all the initiatives they have introduced, including tax-free savings accounts, or venture capital companies under 12J, are precluded from investors managing their own money in listed shares or venture capital companies themselves ultimately being listed.

These tax incentives in South Africa do not have the secondary objective of developing this country’s public markets, whereas Canada’s flow-through shares do, and they have been hugely influential in funding exploration – something 12J still does not appear to be doing.