BHP Billiton briefing on its investment and infrastructural development In Africa

FOREIGN AFFAIRS PORTFOLIO COMMITTEE
11 October 2006
BHP BILLITON BRIEFING ON ITS INVESTMENT AND INFRASTRUCTURAL DEVELOPMENT IN AFRICA

Chairperson: Mr D Sithole (ANC)

Documents handed out:
BHP Billiton: Presentation

SUMMARY
The world’s largest diversified resource company, BHP Billiton, briefed Members about the company’s business conduct in Africa and other developing regions. The presentation emphasised the good corporate values that distinguish the company as an aid to development in Africa. The presentation also stressed the important relationship that should continue to exist between the South African Government and BHP Billiton. Members were pleased with the commitments that BHP Billiton had made to combat infrastructure underdevelopment and health issues in Africa. Members were eager to learn more about the measures that were used to reduce the spread of malaria and methods that could halt the spread of HIV/Aids.

MINUTES
Briefing by BHP Billiton
Dr Vincent Maphai, Chairman of BHP Billiton South Africa Ltd., briefed the Committee about the Company’s involvement in investment and infrastructural development in Africa. Despite the strong growth achieved by the company, it was noted that there were missed opportunities for growth ventures between BHP Billiton and the Government.

The presentation outlined the values and the commitment of BHP Billiton in forming strong public-private partnerships. The values stressed sustainable development and confidence-building because of the lasting benefits it would have on the society. There was a vested interest in Africa, conflict resolution, poverty alleviation, major investments and the NEPAD values.

The Mozambican Aluminium Smelter (MOZAL) was highlighted as a significant achievement and an indicator of the possibilities that exist in Southern Africa. The Chairman noted that BHP Billiton was unique because of its diversity and commitment to economic excellence. BHP Billiton was displaying rapid growth as it had operations in Australia, Asia and a significant footprint in Africa. The company was also keen to enhance intra-African trade.

The relationship between business and government was crucial in South Africa. BHP Billiton was a major contributor to the South African economy and emphasised the need for further collaboration. The Chairman noted that it was a “win-win” situation for both parties. The Chairman noted that certain issues of communication between the government and BHP Billiton had to be addressed. There was a need for the Committee and BHP Billiton to create strong lines of communication so that missed opportunities would not occur again.

Discussion
Mr D Gibson (DA) noted that the Democratic Alliance subscribed to the foreign policy being an issue of national interest. He queried whether the South African business had sufficiently promoted South Africa’s long term interest.

He required clarification for the concept of a forum and whether business would compile a list of its ambitions. He asked for an explanation regarding BHP Billiton’s role in the reduction of malaria.

Mr Mohamed Seedat, President of Energy Coal at BHP Billiton, noted that meetings were arranged between governments and relevant businesses to address the problem of malaria. Through knowledge sharing and educating the communities, the involved parties were able to reduce the instances of malaria.

Dr Maphai stated that details relating to the establishing a forum were not available. The intention was to stop the haphazard way of communication between the Committee and business that was currently taking place.

Mr M Ramgobin (ANC) stated that South Africa’s foreign policy was rooted in its human rights agenda. The Constitution had guided the principles it had for development in Africa. He queried BHP Billiton’s position on regional integration and whether it had formed links with Zimbabwe and Angola.

Dr Maphai noted that foreign affairs had become synonymous with international trade. He noted that many issues were omitted. He noted that BHP Billiton was actively involved in Angola but not involved in Zimbabwe. He stated that this was not due to political reasons.

Dr Maphai stated that BHP Billiton did not have a vested interest in continuing conflict. Their role was to interact with responsible governments and help facilitate conflict resolution.

Adv M Madasa (ANC) asked whether the missed opportunities could be re-captured. He noted that business was usually focused on profit-making and social investment and asked whether BHP Billiton subscribed to these conditions.

Dr Maphai noted that missed opportunities were a consequence of the haphazard way the different parties interacted. He noted that social investment was an important principle for BHP Billiton.

Dr S Pheko (PAC) noted that the prospectus would involve geological work. He asked what training was being done.

Mr Seedat noted that projects were formulated to help develop the capacity for local actors. Graduate students were trained to assist with operations before investment had taken place. This would help empower local actors and build capacity before BHP Billiton would enter a country.

Dr A Luthuli (ANC) noted that the political dimension of conflict areas had often affected the business interests of certain companies. She asked how BHP Billiton was dealing with rising levels of HIV/Aids. She queried whether there was collaboration between BHP Billiton and the Health Departments in the respective countries.

Mr Seedat stated that BHP Billiton’s policy towards HIV/Aids would focus on making anti-retrovirals and counselling available for everyone.

He noted that work-related diseases were addressed by a clinic and that employees would go through regular medical examinations. The objective was to reduce exposure in all their operations around the world.

Mr M Skosana (IFP) asked whether health programmes had been improved in Mozambique. He stated that there was a gap between foreign affairs and trade and industry and queried whether a common understanding would be formed.

Mr L Khoarai (ANC) noted that South Africa should be careful about its mining interests in other countries. He asked what health and safety programmes existed for people working in the mines.

Dr Maphai noted that the nature of the industry meant that economic growth had to be long term. BHP Billiton’s affirmative actions policies were in accord with the respective countries in which they were operating.

The Chairperson noted that business and the Government must uphold common values that should be defended.

The meeting was adjourned.