South Africa: Horizontal linkages— Building expertise by overcoming country-specific constraints

South Africa's mining sector historically drove industrialization by creating a specialized upstream supplier sector that overcame unique technological challenges of deep-level mining. These capabilities evolved into horizontal linkages, allowing firms to export expertise in products like coal-washing spirals and underground locomotives to other sectors and global markets. While the sector has declined as a percentage of GDP, it remains a critical export driver. Recent government policies have focused on socio-economic transformation and downstream beneficiation rather than supporting horizontal linkages, while skills shortages and policy uncertainty have hindered recent growth.

• Horizontal linkages in South Africa's mining sector were primarily driven by market forces and private sector involvement rather than government intervention.
• The unique scale and technological challenges of South African mineral deposits, particularly deep-level mining, necessitated the development of specialized local equipment and techniques that later became exportable.
• Five main drivers enabled capability-led horizontal linkages: the scale of resources, the specific type of mining required, cooperation between firms (such as through the Chamber of Mines), the formation of geographical clusters around Johannesburg and the Witwatersrand, and the ability of suppliers to diversify into non-resource markets.
• The relative importance of the mining and manufacturing sectors to the national economy has decreased; mining fell from 20% of GDP in the 1980s to roughly 7%, and manufacturing fell from 20% in 1994 to roughly 12%.
• Post-apartheid government policies have focused on socio-economic redress and downstream beneficiation rather than explicitly targeting horizontal linkages or providing specific incentives for mining suppliers to enter new markets.
• Current challenges to the sector include policy uncertainty regarding mining rights and ownership, a widening knowledge gap between mining and non-mining sectors, and a critical shortage of skills exacerbated by international recruitment from countries like Australia.

APA

Dolo, S., Odendaal, M., & Togo, G. (2018). South Africa: Horizontal linkages— Building expertise by overcoming country-specific constraints. International Institute for Sustainable Development. https://www.iisd.org/sites/default/files/publications/case-study-south-africa-horizontal-linkages.pdf

Chicago

Dolo, Somine, Martin Odendaal, and Guire Togo. South Africa: Horizontal linkages— Building expertise by overcoming country-specific constraints. International Institute for Sustainable Development, 2018. https://www.iisd.org/sites/default/files/publications/case-study-south-africa-horizontal-linkages.pdf.

Wikipedia

{{cite report |last1=Dolo |first1=Somine |last2=Odendaal |first2=Martin |last3=Togo |first3=Guire |title=South Africa: Horizontal linkages— Building expertise by overcoming country-specific constraints |publisher=International Institute for Sustainable Development |date=2018 |url=https://www.iisd.org/sites/default/files/publications/case-study-south-africa-horizontal-linkages.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{dolo2018south, author = {Dolo, Somine and Odendaal, Martin and Togo, Guire}, title = {{South Africa: Horizontal linkages— Building expertise by overcoming country-specific constraints}}, institution = {International Institute for Sustainable Development}, year = {2018}, url = {https://www.iisd.org/sites/default/files/publications/case-study-south-africa-horizontal-linkages.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }