Zuma concerned about pressure steel industry is under - The Presidency

President welcomes dialogue between govt, business and labour, urges that more work be done by all sides to strengthen the sector

President Zuma urges united action by all to save jobs in the steel and iron sectors

25 August 2015

President Jacob Zuma has urged government, business and labour to work tirelessly together to save jobs in the iron and domestic steel industry sector.

The President is concerned about the pressure that the industry is facing currently which is threatening to result in job losses that would be damaging to the economy and to many families.

On Friday 21 August 2015, a government delegation led by the Minister of Trade and Industry, Dr Rob Davies and the Minister of Economic Development, Mr Ebrahim Patel, met with representatives from business and labour on the challenges faced in the iron and domestic steel industry. The challenges arise in the main 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 President has welcomed the dialogue and urges that more work be done by all sides to save jobs and strengthen the sector. “This is a time for unity in the sector so that this critical industry can be supported and emerge from the current challenges stronger and play its historic role as a critical player and employer in the economy.’’

In the meeting on Friday, 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 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.

Government also 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 will 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.

Statement issued by Bongani Majola, The Presidency, August 25 2015