On Friday 21 August 2015, a government delegation led by Ministers Davies and Patel, met with representatives from business and labour on challenges faced in the iron and domestic steel industry, arising principally from global factors including the current glut of steel resulting in increasing imports of steel products into South Africa and cost-pressures on the industry.
The meeting was attended by Seifsa, Cosatu, Numsa, the NUM, Solidarity, UASA, Transnet and various government departments.
The meeting followed requests respectively from COSATU and its affiliates for a meeting to discuss job losses and its section 77 application at Nedlac; and from Numsa, Seifsa and other trade unions for a meeting on the state of the steel industry. Government combined the two processes and convened the meeting to provide information on a range of measures being taken by the public authorities and to obtain feedback on the concerns by stakeholders as well as the steps they are taking to address the challenges in the industry.
Government advised the parties on:
- The processes underway in International Trade Administration Commission of South Africa (ITAC) to consider various tariff applications and noted that ITAC has finalised consideration on a tariff adjustment application on three products, which will shortly be processed via government for final decision; that new applications have recently been received and are being considered on an expedited basis; and that no anti-dumping applications have as yet been received from industry.
- Steps taken to address the challenges faced by Highveld Steel. These include a R150 million funding facility made available by the Industrial Development Corporation (IDC) and processes through business rescue to identify viable new technology and equity partners for the company.
- Measures taken to address the surge in the export of scrap metal that undermine domestic industry and compromise national goals such as the national infrastructure plan and climate change commitments made by government.
- Other steps taken, including a competition probe on pricing in the industry, advice solicited from a panel of experts in the steel industry, beneficiation pilot projects (such as on fuel-cell technologies), designation of domestically-manufactured steel products for public procurement.
Business and labour shared their concerns, including on the impact of carbon-tax and the multiplier effects that job losses in the steel and iron-ore sector could have on the wider economy.
Government identified contact persons to liaise with parties on trade investigations, tightening of scrap-metal regulations and better use of the training layoff scheme introduced during the economic downturn of 2009.
Government noted that it had demonstrated an appetite to support local industry, including through defending public interest measures when these were taken on review to the courts. The example of scrap metal regulations was cited.
Government provided information to show a substantial spending on public infrastructure and provided the stakeholders with examples of industrial successes through the public localisation programme.
Government emphasised that while the public authorities would implement steps to save jobs in the industry, more also needed to be done by business and organised labour to create a conducive environment and avoid job losses. In particular, it called on business to reduce job losses and on both parties to build strong workplace partnerships.
Government noted that delays in tabling applications for trade relief from the companies in the sector should be addressed by the private sector so that ITAC could apply the law to the facts before it. Government reiterated that it will combine a speeded-up process in this and other sectors of the economy during this period of volatile global conditions and that it will do so mindful of its legal obligations.
The Ministers advised the stakeholders that they would convene a follow-up meeting in about four weeks’ time to consider the progress made. This meeting would take place after receipt of the anti-dumping application from companies in the sector.
Enquiries:
Mahomed Vawda
Cell: 079 710 4636
Sidwell Medupe
Tel: 012 394 1650
Cell: 079 492 1774
