ID'S LANCE GREYLING ASKS MINISTER HOGAN WHETHER ARCELOR MITTAL IS ALSO RECEIVING ‘DIRT CHEAP' ELECTRICITY?'

Lance Greyling, the ID spokesperson for finance and public enterprises, has called on the Government ‘to stop allowing multinationals to exploit our resources without any developmental benefits for our people.'

The ID MP, who blamed the ANC Government's ‘naivety and Alec Erwin -era incompetence' for the current dispute between ArcelorMittal and Kumba Iron Ore, has now submitted a question [below] to Public Enterprises Minister Barbara Hogan, asking her whether ArcelorMittal has also been receiving ‘dirt cheap electricity'.

‘ArcelorMittal has been receiving South Africa's iron ore at a hugely discounted price, which was part of the agreement that was signed with Kumba Iron Ore when the state-owned steel company Iscor was privatized and sold off to ArcelorMittal,' Mr Greyling says.

‘However, another part of the agreement, one which ArcelorMittal has conveniently ignored, was that South Africa's steel industry would be sold steel at lower prices than that being charged on the international market.

‘The Government, in its naivety and incompetence, however, did not lock this agreement into place and ArcelorMittal has been allowed to make huge profits at the expense of our local industry by charging them import parity prices,' says Greyling.

‘It is hardly surprising that ArcelorMittal's South African steel manufacturing plant has been the most profitable of its international ventures.

‘Just imagine if they have also been given dirt cheap electricity and are paying a tiny fraction of what most businesses in South Africa, and especially ordinary consumers, are forced to pay,' Greyling says.

‘If this turns out to be the case then this would just add insult to injury and would be proof that rather than being patriotic by utilizing our natural resources for the benefit of our people, the ANC government gives multinationals free reign to rob us blind.'

National Assembly

Written Reply

Date submitted: 8th March 2010

Mr Lance Greyling to ask the Minister of Public Enterprises:

1) Does the company ArcelorMittal South Africa receive electricity at a reduced tariff structure?

2) Is this tariff structure part of the Mega-Flex Rate or is it based on an earlier agreement signed with Eskom which supplies electricity at a reduced fixed rate?

3) How much electricity does ArcelorMittal utilise and what percentage of South Africa's total energy usage does this comprise?

4) By what percentage will the price of their electricity increase as a result of the latest price increase announced by Nersa?

Statement issued by Lance Greyling, MP, Independent Democrats Chief Whip, March 9 2010

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