Huge shift in mining spend

27 February 2009

27 February 2009 | Andy Allen

The South African arm of mining company Anglo American has increased spending with suppliers owned and managed by black people to 42 per cent.

Anglo American South Africa said it spent R24.6 billion (£1.7 billion) on procurement and investment in consumables, services and capital projects last year with black-owned or managed vendors. This compared to a figure of R17.3 billion (£1.2 billion) in 2007.

Subsidiary Anglo Platinum was the highest black economic empowerment (BEE) spender with R9.9 billion (£690 million), followed by Anglo Coal with R4.8 billion (£330 million) and Kumba Iron Ore with R2.2 billion (£150 million).

Anglo American SA also reported that Anglo Zimele, its enterprise development unit, had invested in nine new companies through its supply chain fund in 2008.

Kuseni Dlamini, head of Anglo American SA, said: "Since 1999 we have made a significant contribution to BEE procurement and business development. I am immensely proud of the opportunity which Anglo American has afforded deserving entrepreneurs through the Anglo Zimele funds."

In 2008, the mining group's small business start-up fund approved 179 loans worth R51.9 million (£3.6 million) to provide working capital for small vendors.

In its group results for 2008, the company said it was on track to save $1 billion (£698 million) by 2011 from procurement and shared services.

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