LONDON, March 5– Deputy President Kgalema Motlanthe has re-assured British investors that the South African government is doing its best to ensure that there is stability in the volatile mining sector in which protracted labour disputes have unsettled foreign investors.

Motlanthe met a pro-South Africa lobby group in London on Monday in the course of a visit to the British capital to attend the memorial service held at Westminster Abbey to honour the late South African leader, Nelson Mandela .

Britain is one of South Africa’s major trading partners in Europe with two-way trade between the two countries valued at about 157 billion Rand (about 14.53 billion US dollars) a year. Britain is also South Africa’s number one source of long-haul tourism.

However, critics have accused the South African government of failing to implement policies that could increase foreign investment. An analyst of emerging markets at London=based Nomura International PLC, Peter Montallo, has lashed out at the government for not being decisive in the implementation of viable economic development policies.

Montallo says: “Investors understand the problems in South Africa. The real issue is about implementation of those plans. Since 1994 we’ve had RDP, GEAR, and now the NDP. So, investors have scepticism about how these plans are being implemented to boost potential growth which is currently at a low level.”

Labour disputes and high production costs in the mining sector have been cited as major impediments to foreign direct investment.

An economist at Stanlib Asset Management Ltd in Johannesburg, Kobus Nell, says: “We’ve already seen companies like BHP Billiton not committing capital to South Africa in labour-intensive mining. This means that this kind of investment is very risky and capital providers will ask a lot of questions when one thinks of funding future projects under the current environment and structure.”

Motlanthe said British investors appreciated the South African government’s efforts to stabilize the mining sector. He has been leading the government’s intervention in the sector which has seen six weeks strike by the Association of Mining and Construction Worker (AMCU) union, costing companies, workers and the economy combined millions of rands.

“Well most of them that we had the opportunity to speak to have confidence in South Africa that is equal to the challenges. They have experience here of the labour movement in the mining industry. So the fact that workers do withdraw their labour power is part of their own experience. The question is how we deal with that? – and they’ve confidence that the mining sector would be stabilized,” adds Motlanthe.

There are more than 300 British companies operating in South Africa and some locals doing business in Britain. South Africa and Britain are looking to increase economic and trade ties through the export of high-value-added goods to Britain.