Ironically, this protection of the “local” Amsa is adversely affecting another localisation project — it must not be forgotten that Duferco SA is a 50% joint project with the Industrial Development Corporation, making it a much more local company than Amsa.
It must also be recognised that the extra cost and inefficiency implicit in localisation is passed on to the rest of the economy because steel is so fundamental to virtually every sector. In SA, steel creates 190,000 jobs directly; the major steel-consuming industries contribute about 15% to our GDP and employ 8-million people directly and indirectly.
Making the local steel market more competitive will also help ensure SA companies can compete better on global markets because the steel they use is less expensive and of good quality. Do I need to add that a strong export sector is critical to an economically healthy SA? This is a perfect opportunity for the government to pursue its localisation strategy intelligently by steering us away from a steel monopoly in which Amsa is both sole local producer of HRC and has its own rerolled business. In so doing, it will create the conditions for a vibrant, job-creating local steel industry on the back of the real, free and fair competition that is desperately needed by downstream manufacturers.
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