SOUTH AFRICA NEEDS NEW ANTI-CORRUPTION AGENCY TO DEAL WITH PUBLIC CORRUPTION AND CORPORATE MALFEASANCE
Johannesburg, 20 September 2018 – State capture needs to be dealt with urgently to restore public confidence in the State, the constitutional framework and the rule of law. This is the view of Council for Advancement of the South African Constitution Executive Secretary Lawson Naidoo.
Speaking on the first day of the two-day Southern African Metals and Engineering Indaba taking place at the IDC Conference Centre, Mr Naidoo said to end or contain the cancer of public corruption and corporate malfeasance in South Africa, the country needs a fit for purpose anti-corruption agency focused on enforcement, prevention and education. The agency would be buttressed by a strong political will.
Speaking on the same panel, Organisation Undoing Tax Abuse Executive Director Wayne Duvenage said state capture was a serious matter which had allowed creative accounting to take place, unchallenged, at State-owned entities.
He called upon the audit industry to review its code and board members of State-owned entities and the business community at large to play a bigger role in combating corruption.
“Business is missing in action. We hear business leaders saying Government is not taking them seriously enough but I think we need to see the business community stand up more often. Business needs to stand firm and strong in the fight against public corruption and corporate malfeasance,” Mr Duvenage said.
He also said that the country needed new board members and Director Generals in Governments to investigate and challenge all past contracts; drive new energy throughout Government and business for moral courage and strong anti-corruption values.
In conclusion, Mr Duvenage said a stronger civil society that actively challenges wrongdoing and holds Government to account was also needed.
Issued by:
Ollie Madlala
Communications Manager
Tel: (011) 298 9411 / 082 602 1725
Email: ollie@seifsa.co.za
Web: www.meindaba. seifsa.co.za
NATIONAL DEVELOPMENT PLAN STILL RELEVANT DESPITE SLOW PACE OF IMPLEMENTATION – DR NKOSAZANA DLAMINI ZUMA
Johannesburg, 20 September 2018 – South Africa’s National Development Plan (NDP) was still relevant despite the slow pace of its implementation, Minister in the Presidency Nkosazana Dlamini-Zuma said at the Southern African Metals and Engineering Indaba this afternoon.
“We have not made sufficient progress as far as eradicating the triple challenges of unemployment, poverty and inequality, but we still feel strongly that the NDP is still relevant but needs to be approached differently, with us having learned from the last six years. We also think that there was an oversight to think we could implement without breaking it down into five-year implementation plans. This is what we will begin to do with the remaining years of the NDP. We will also use the last two years of the plan to monitor and evaluate,” Dr Dlamini-Zuma said.
Going forward, the Minister said Government needed to improve planning generally, not only across all departments, but also across different spheres of Government.
“Lack of integrated planning slows down projects and makes implementation harder. It is not easy to implement when we have not planned together,” Dr Dlamini-Zuma said.
The Minister said the Government has realized that it had too many priorities. Going forward, it would ensure that there were fewer priorities that would have maximum impact.
“What we have also realized is that it would not be enough to align planning across spheres and departments, but we also need the private sector to play a role in the actual planning of the NDP. Lots of activities such as the creation of jobs and growing the economy will be driven by the private sector, so we have to touch base with the private sector as we plan and implement the NDP,” she said.
She said collaboration with the private sector would also not be enough if the country is not producing the skills required for the implementation of the infrastructure project within the NDP.
“It is, therefore, equally important that at some point we also involve institutions responsible for the production of skills because there is currently a mismatch between the skills required by the labour market and the skills produced by institutions of higher learning,” she said.
Dr Dlamini-Zuma said partnerships and collaboration needed to be strengthened at sector-specific level. She said that, as part of monitoring and evaluating, the Government would look at specific targets and timelines, but cautioned that that could only be achieved by a capable State with people with relevant skills.
In conclusion, Minister Dlamini Zuma said the economy needed not only growth in terms of GDP, but also to find ways of creating jobs and reducing poverty and inequality
Manufacturing Circles CEO Philippa Rodseth said she concurred with the Minister that there was a mismatch between the skills demanded by the economy and the skills produced. She also concurred that better collaborations between business, policy makers and institutions of learning was important for better implementation of the NDP.
Professor Patrick Bond of the Wits Business School cautioned against the prioritization of projects that would have little benefit for the country, but would create opportunities for corruption. He also warned against Chinese colonization of the country.
Issued by:
Ollie Madlala
Communications Manager
Tel: (011) 298 9411 / 082 602 1725
Email: ollie@seifsa.co.za
Web: www.meindaba. seifsa.co.za
DOMESTIC MANUFACTURES MUST WORK TOGETHER TO SURVIVE
Johannesburg, 20 September 2018 – The global trade war between two of the world’s largest economies has the potential to render global growth less synchronised, less certain and less supportive of emerging economies. Moreover, weaknesses in the global economy would make it even more difficult for South Africa to accelerate its fortunes and for the metals and engineering (M&E) cluster, the mining and construction sectors and the auto manufacturing industries to maximise their potential, Steel and Engineering Industries Federation of Southern Africa Chief Economist Michael Ade said this afternoon.
Speaking at the Southern African Metals and Engineering Indaba, Dr Ade said the four sectors needed higher growth levels underpinned by better productive efficiency. He also said that instead of continuously depending on government to boost demand via various interventions, stakeholders in these sectors needed to rally to support each other.
“Proactivity rather than reactivity is needed to take advantage of promising regional prospects, where healthy GDP growths have been projected. Targeted growth in lucrative markets of Asia and Europe should also be taken advantage of, in order to increase market share,” Dr Ade said.
He said that the four groups can leverage on existing linkages. “The M&E cluster should support the mining sector more by increasing its current procurement spend in the mining sector to over 63%.”
Alternatively, Dr Ade said the construction sector should support the M&E cluster by increasing its current share of procurement spend to over 35% and; likewise, the Auto industry should increase its current procurement spend from the cluster’s intermediate products to over 33%
Commenting on constraints to leveraging on existing opportunities, Dr Ade said the extent to which total domestic demand in the M&E cluster is satisfied by imports has increased to 54.1%, as important component manufacturers shut down; high importation of intermediary inputs, and the vulnerability to imported inflation along with depreciating currency-induced price increases.
“There is a cocktail of high costs due to issues of high logistical and transport costs, low relative labour productivity and high energy costs,” Dr Ade said.
In response to these challenges, Dr Ade said policy makers should target individual interventions to various sub-components of manufacturing and not treat manufacturing as a homogenous lot.
He said Government also needed to regulate pricing of key inputs from sole suppliers; continuously enable competition in electricity generation and reconsider administered prices for example, food and petrol, to put money back into consumers’ pockets.
Meanwhile Minerals Council South Africa Economist Tafadzwa Chibanguza said the mining sector was currently buying more than 70% of products from local suppliers, he cautioned that local suppliers were, however, not local manufacturers.
He said there was, therefore, a real need for concerted efforts by mining companies to create a market for locally-manufactured goods but warned that Government needed to diversify the economy in order to ensure sustainability for industries that supply to the mining sector.
Commenting on South Africa’s Automotive Masterplan 2035, National Association of Automobile Manufacturers of South Africa Director Nico Vermeulen said for the plan’s vision to be realised, policy certainty, stable industrial relations environment, effective beneficiation strategy and reduction in infrastructure, logistics and other input costs were needed.
Master Builders South Africa Executive Director Roy Mnisi said there would always be demand for metal and steel by the construction sector even in tough economic times however, the M&E sector needed be internationally competitive, act locally and think globally.
“The M&E sector must also protect its territory by guarding against sub-standard products entering the market,” he concluded.
Issued by:
Ollie Madlala
Communications Manager
Tel: (011) 298 9411 / 082 602 1725
Email: ollie@seifsa.co.za
SOUTHERN AFRICAN METALS AND ENGINEERING INDABA 2018 OPENING ADDRESS
OPENING REMARKS
Thank you, Melissa.
Ladies and Gentlemen, welcome to the Fourth Southern African Metals and Engineering Indaba. Our inaugural conference took place at Emperors’ Palace at Ekurhuleni in 2015, before we concluded a strategic partnership agreement that saw us meeting here at the IDC Conference Centre over the past two years. This is now the third conference here at the IDC, and we are immensely grateful to the Corporation.
Thank you, Ladies and Gentlemen, for your support and patronage. It always means so much to us to have you turning out in such numbers at this important industry conference. The starting point in arranging a conference is getting the right topics and relevant speakers to address them, but the most important is ensuring that there is an active, participative audience to engage meaningfully with the speakers and the topics under discussion. Therefore, this conference would not be the success that we would like it to be without your presence.
We are immensely grateful to all our Speakers, all of whom are busy men and women who have put time aside to be with us in the course of today and tomorrow. Quite a number of them have become regulars, and have addressed the Southern African Metals and Engineering Indaba at least once or even twice before. They are the lifeblood of this annual conference: without them, there is no conference.
From our inaugural year, we have been very fortunate to get top-quality speakers for this Indaba. We thank each one of them – those already here with us this morning, and the many others yet to join us in the course of the day and tomorrow.
As always, our Partner, the Industrial Development Corporation, and our Sponsors are richly deserving of our appreciation and gratitude. As with some of our speakers, quite a number of our Sponsors have come to be reliable, regular Partners of ours when it comes to the Southern African Metals and Engineering Indaba. MerSeta and Standard Bank have been with us from the very beginning, and over the past two years we have been delighted to welcome Sanlam, Investec, Novare, Kagiso Asset Management and SMS Group on board. We are delighted to welcome Rand Mutual Assurance on board this year.
We are immensely grateful to and appreciate all our sponsors, but wish to acknowledge, in particular, the 100-year-old Sanlam, which is our Gold Sponsor this year, and which was also our Primary Sponsor for the annual SEIFSA Golf Day last month. We know that Sanlam has expressed a wish to grow that partnership with SEIFSA stronger from year to year, and we eagerly look forward to that.
Finally, we also acknowledge and appreciate our media partners: Engineering News, Independent Newspapers and Classic FM.
Ladies and Gentlemen, 2019 will mark the fifth anniversary of the Southern African Metals and Engineering Indaba. Coinciding as it will with SEIFSA’s 76th year, we have every intention of making it our biggest and best conference ever. To accomplish that goal, we will need the dedicated support of all our delegates, our Strategic Partner the IDC and all our Sponsors. Indeed, we will need the active support of the governments that we and our compatriots elected at local government level and will have elected next year at provincial and national levels.
Regrettably, the only thing that the Southern African Metals and Engineering Indaba has not yet had to the full extent is the enthusiastic support of our democratic Government. While we have deeply appreciated the involvement of Former President Kgalema Motlanthe, then-ANC Treasurer-General Dr Zweli Mkhize, Ministers Mildred Oliphant, Pravin Gordhan, Lindiwe Zulu, Ebrahim Patel and, this year, Dr Nkosazana Dlamini-Zuma, hitherto we have struggled to get the President of the country, the Deputy President of the country, the Minister of Trade and Industry, other key Ministers, the Gauteng Provincial Government and the Cities of Johannesburg and Ekurhuleni to show the metals and engineering sector the respect worthy of them by participating in this conference.
While we welcomed President Cyril Ramaphosa’s commitment, during his inaugural State of the Nation Address in February, that the Government will place an emphasis on manufacturing, we must say, though, that we are deeply concerned that we have not yet seen a higher level of commitment to the metals and engineering sector from the Department of Trade and Industry and other parts of his Government (including the Presidency itself). They were all invited to this conference, but waited until the eleventh hour to inform us that, once again, they would not bother to join us. We find that deeply concerning and hope that there will be a change in attitude after next year’s elections.
I mention this, Ladies and Gentlemen, to make the important point that SEIFSA is not a politically partisan organisation. We believe in working in collaborative partnership with all stakeholders, starting with the three spheres of government, regardless of whichever party is in power in that sphere at the time. We want always to have healthy, constructive relations with our elected governments and our labour partners. That is why we get deeply concerned when elected officials who are accountable to us as personal and corporate taxpayers do not take as important a sector of the economy as the metals and engineering cluster seriously and want to be begged to do the work for which we pay them.
In the past, some in Government, especially at the Department of Trade and Industry, have wanted to lean on us to exclude members of the Official Opposition from the programme before that Department could support us. They have gone as far as wanting to have a say on the composition of the programme and the identification of speakers to be invited. Needless to say, we have rejected both attempts.
Personally, I have been deeply alarmed by such conduct from a Government Department that is meant to be a champion for business in government. That suggests that some people in that Ministry – and, perhaps, in Government in general – have tended to see themselves as deployed party apparatchiks rather than the servants of the people. That, in my view, will explain why, in the four years of this conference, we have not once had the privilege of the Minister of Trade and Industry or the Director-General in that Department addressing – let alone attending – the Southern African Metals and Engineering Indaba. This is particularly disturbing when one considers, to the best of one’s knowledge, that, quite correctly, there has never an annual Mining Indaba without the presence and active participation of the Minister of Mineral Resources, whoever the incumbent has been at the time.
Clearly, then, Ladies and Gentlemen, we need a serious change in attitude from the Department of Trade and Industry and many others in Government, including the Gauteng Provincial Government which has excelled at making all sorts of promises but has been spectacularly poor at meaningfully reaching out to and working with business – or, in particular, the metals and engineering sector. Over the past three years we have invited both the Gauteng Premier and his Economic Development MEC to this conference, and neither has even bothered to reply to that invitation.
That, I suggest, is simply not good enough. Instead, it speaks of the arrogance that has come to characterise our Government. We must hope, therefore, that the now-fading “New Dawn” promised by an ebullient President Ramaphosa will soon manifest itself, with the President and his Deputy leading by example. We must state clearly that the Government does not do us a favour by engaging with us. Instead, it would be doing its job – and that is all we are asking it to do.
Those in Government must know that, whenever they refuse to make themselves available to address this conference, we will simply extend an invitation to those – inside and outside this Government, including members and leaders of opposition parties – who are willing to engage with us. They are important to us because of the lofty positions that they hold in government, but they certainly do not possess a monopoly on wisdom or insights into what is important for the revival of our economy.
With that out of the way, let me move on to extend my deepest gratitude to Dr Mathews Phosa, former ANC Treasurer-General and the inaugural Premier of Mpumalanga, for bailing us out and agreeing, when we were let down by the Presidency at the eleventh hour, to deliver the Opening Address this morning. I am also equally grateful to the Leader of the Official Opposition, Mmusi Maimane, for similarly accepting our invitation to deliver the Closing Address tomorrow afternoon, after repeated attempts to get Deputy President David Mabuza to do so failed dismally. To Dr Phosa, a veteran businessman and experienced politician, and to Mr Maimane, thank you very much for your continued accessibility.
Finally, I acknowledge the presence this morning of a number of our Board Members, among them Interim President Alph Ngapo, and the Chairpersons and members of our various member Associations. Also acknowledged, with gratitude, is the presence of members of the leadership of the IDC.
We look forward to a fruitful, robust engagement with our speakers in the course of the next two days. At the end of each day, there will proposed resolutions that will be put to you, the delegates, for your consideration and adoption.
Ladies and Gentlemen, we at SEIFSA believe very firmly that, however difficult things may be at the moment, there continues to be a future for Manufacturing in South Africa and our region, and we believe that that future also includes a thriving Metals and Engineering Sector. However, for the sector to realize its full potential, it behoves all of us – in business, Government and labour – to get all hands on deck.
Thank you very much, yet again, for your attendance. Let us have a fruitful engagement that will be seen by future generations to have vital for the continued survival of our Sector.
SOUTH AFRICA NEEDS COHERENT AND WELL-EXECUTED ECONOMIC STRATEGY TO GROW – DR MATHEWS PHOSA
Johannesburg, 20 September 2018 – A change in attitude towards the metals and engineering sector from Government, particularly the Department of Trade and Industry and the Gauteng Provincial Government is urgently needed, Steel and Engineering Industries Federation of Southern Africa CEO Kaizer Nyatsumba said this morning.
Speaking at the fourth Southern African Metals and Engineering Indaba taking place at the IDC Conference Centre today and tomorrow, Mr Nyatsumba said the Indaba has not yet had to the full extent the enthusiastic support of Government.
“While we have deeply appreciated the involvement of Former President Kgalema Motlanthe, then-ANC Treasurer-General Dr Zweli Mkhize, Ministers Mildred Oliphant, Pravin Gordhan, Lindiwe Zulu, Ebrahim Patel and, this year, Dr Nkosazana Dlamini-Zuma, hitherto we have struggled to get the President of the country, the Deputy President of the country, the Minister of Trade and Industry, other key Ministers, the Gauteng Provincial Government and the Cities of Johannesburg and Ekurhuleni to show the metals and engineering sector the respect worthy of them by participating in this conference,” he said.
He added that while the business community welcomed President Cyril Ramaphosa’s commitment, during his inaugural State of the Nation Address in February, that the Government will place an emphasis on manufacturing, business was deeply concerned that a higher level of commitment to the metals and engineering sector from the Department of Trade and Industry and other parts of his Government (including the Presidency itself) was yet to be seen.
“They were all invited to this conference but waited until the eleventh hour to inform us that, once again, they would not bother to join us. We find that deeply concerning and hope that there will be a change in attitude after next year’s elections,” said Mr Nyatsumba.
He said SEIFSA believed in working in collaborative partnership with all stakeholders, starting with the three spheres of government, regardless of whichever party is in power in that sphere at the time.
“We want always to have healthy, constructive relations with our elected governments and our labour partners. That is why we get deeply concerned when elected officials who are accountable to us as personal and corporate taxpayers do not take as important a sector of the economy as the metals and engineering cluster seriously.”
He said in the four years of the Indaba’s existence, the Conference, has not once had the privilege of the Minister of Trade and Industry or the Director-General in that Department addressing – let alone attending it.
“This is particularly disturbing when one considers, to the best of one’s knowledge, that, quite correctly, there has never been an annual Mining Indaba without the presence and active participation of the Minister of Mineral Resources, whoever the incumbent has been at the time.”
Meanwhile, delivering the Indaba opening address, former ANC Treasurer-General and the inaugural Premier of Mpumalanga Dr Mathews Phosa said South Africa needed an economic strategy that is coherent, well-conceived and well-executed.
“We also need real leadership and real leadership signifies that you should be willing to take short-term decisions that are unpopular but will benefit your country and its people in the long term by creating policy stability, a positive view from local and global investors, and incentives for local entrepreneurs to take risks,” said Dr Phosa.
He said South Africa’s current situation needed policy stability that is devoid from incoherence and populistic, vague statements; a strengthened economic and patriotic pact between government business and labour; large scale deregulation of the small business sector; large scale deregulation of all manufacturing sectors; private public partnership to replace the current wholly-owned state companies, a total revamp of the National Prosecuting Agency so that South Africans and foreigners can take pride in the stability of the country’s justice environment and improved, detailed and specific communication with the South African nation and the global community regarding the expropriation of land.
Issued by:
Ollie Madlala
Communications Manager
Tel: (011) 298 9411 / 082 602 1725
Email: ollie@seifsa.co.za
HIGH-CALIBRE SPEAKERS TO ADDRESS CHALLENGES CONFRONTING THE METALS AND ENGINEERING INDABA STARTING TOMORROW
Johannesburg, 19 September 2018 – High-calibre speakers – including Cabinet Ministers senior business leaders and labour leaders – will address delegates attending the fourth Southern African Metals and Engineering Indaba taking place at the IDC Conference Centre in Sandton tomorrow and on Friday.
The Indaba, now in its fourth year, is organized and hosted annually by the Steel and Engineering Industries Federation of Southern Africa (SEIFSA), and its core objective is to provide a platform for policy makers, labour representatives and businesses operating in the metals, engineering and related sectors not only to discuss the challenges facing the sector, but also to collaborate in search for sustainable solutions for manufacturing in general and the metals and engineering sector in particular.
Among the speakers will be Minister in the Presidency Dr Nkosazana Dlamini-Zuma, Highveld Structural Mill Chief Executive Officer John Burger and ArcelorMittal South Africa General Manager Alph Ngapo. Former ANC Treasurer-General Mathews Phosa will deliver the opening address tomorrow morning, with Democratic Alliance Leader Mmusi Maimane delivering the closing address on Friday afternoon.
SEIFSA Chief Executive Officer Kaizer Nyatsumba said this year the Indaba will afford its participants an invaluable opportunity to influence policy by adopting conference resolutions that SEIFSA – in collaboration with other business bodies and stakeholders like labour partners – will lobby policy makers on.
Meanwhile, SEIFSA Economist Marique Kruger said innovation and excellence as strategic levers for global competitiveness will also come under scrutiny at this year’s Indaba. She said prior to 2017, the metals and engineering sector had been in decline for three consecutive years. This had resulted in production declines, under-utilisation of production capacity, employment losses, unprecedented low-profit margins and near-stagnation in investment.
“Despite the up-tick in production recorded in 2017, the aforementioned challenges contributed significantly towards reducing the sector’s competitiveness, leading to a loss of international and domestic market share. Therefore, the international competitiveness of the M&E sector will have to improve significantly for the sector to regain its position as preferred suppliers domestically and in international markets,” said Ms Kruger.
Leading discussions on innovation and excellence as strategic levers for global competitiveness will be Council for Scientific and Industrial Research Executive for Industrial Development Dr Rachel Chikwamba, Hazelton Pump International Managing Director Mathys Wehmeyer and Atlantis Foundries Managing Director Mervin Moodley.
Other topics that will feature prominently during the 2018 Indaba include:
- How much of the National Development Plan has been implemented – and is it still relevant?
- Constraints to investing in the Metals and Engineering Sector and improving trade on the African continent
- Exploring and Leveraging the Link Between the Metals and Engineering Sector and the Mining, Construction and Auto Manufacturing Industries
- Radical Economic Transformation, the Black Industrialists Programme and the Metals and Engineering Sector
- Administered Prices As Factors Negatively Affecting South Africa’s International Competitiveness: Can we Change the Situation?
Among the high-profile speakers expected to address the conference are:
- Business leaders like Black Business Council CEO Kganki Matabane, ArcelorMittal General Manager: Africa Overland Alph Ngapo, Hazleton Pump International Managing Director Mathys Wehmer, Atlantis Foundries CEO Mervyn Moodley, National Association of Automobile Manufacturers of SA Director Nico Vermeulen and Master Builders Executive Director Roy Mnisi;
- Policy makers and civil service representatives like Department of Trade and Industry Deputy Director-General Zeph Nhleko;
- Representatives of global organisations like International Finance Corporation Senior Investment Officer Paul Mukasa;
- Civil society leaders like Council for Scientific and Industrial Research CEO Dr Thulani Dlamini; Organisation Undoing Tax Abuse Executive Director Wayne Duvenage and Council for the Advancement of the South African Constitution Executive Secretary Lawson Naidoo; and
- Politicians like ANC Economic Transformation Head Enoch Godongwana, Democratic Alliance Shadow Minister for Trade and Industry Geordin Hill-Lewis and DA Shadow Minister for Public Enterprises Natasha Mazzone.
For more details on the conference, please visit www.meindaba.seifsa.co.za.
Issued by:
Ollie Madlala
Communications Manager
Tel: (011) 298 9411 / 082 602 1725
Email: ollie@seifsa.co.za
Web: www.meindaba. seifsa.co.za
SLOWDOWN IN CONSUMER INFLATION IS ENCOURAGING AS IT RELIEVES PRESSURE ON THE METALS AND ENGINEERING CLUSTER AND OVER-INDEBTED CONSUMERS, SAYS SEIFSA
Johannesburg, 19 September 2018 - The slowdown in the official inflation number released by Statistics South Africa (StatsSA) today is encouraging as beleaguered businesses in the Metals and Engineering (M&E) cluster and over-indebted consumers are afforded a reprieve from generally rising prices of goods and domestic inputs underpinned by a weaker rand and an ever-increasing petrol price, the Steel and Engineering Industries Federation of Southern Africa (SEIFSA) said this morning.
According to the StatsSA data, the annual CPI was 4,9 percent in August 2018, down from 5,1 percent in July 2018. On a month-on-month basis, the index also registered a decrease of 0,1 percent in August 2018.
“This is good news as businesses in the M&E cluster are struggling in an environment of weak domestic demand, including a less-than-proportionate increase in consumer demand. Accordingly, the dip in inflation provides relief to cost pressure on the diverse domestic intermediate inputs of the M&E cluster,” SEIFSA Chief Economist Michael Ade said.
Dr Ade said it was particularly encouraging to read that the data placed the official inflation numbers 0,2 percentage points lower from the July figures and well within the South African Reserve Bank’s inflation target band of 3 to 6 percent.
“With the country desperately needing a countervailing economic stimulus to return the economy to health, the latest inflation data provide a firm rationale for the Reserve Bank’s Monetary Policy Committee to leave repo rates unchanged or even cut the repo rate by at least 25 basis points in order to encourage spending, boost domestic demand and lessen increasing pressure faced by both businesses and individual consumers,” said Dr Ade.
However, he also warned that galloping petrol prices, volatile exchange rate and generally increasing electricity prices – including the potentially negative effects of a global trade war – may discourage the committee from taking an expansionary monetary policy stance since that may ultimately be inflationary.
Issued by:
Ollie Madlala
Communications Manager
Tel: (011) 298 9411 / 082 602 1725
Email: ollie@seifsa.co.za
Web: www.meindaba. seifsa.co.za
MINING, CONSTRUCTION AND AUTOMOTIVE SECTORS CRITICAL FOR M&E SECTOR’S SURVIVAL
Johannesburg, 16 September 2018 – The link between the metals and engineering (M&E) sector and the mining, construction and auto manufacturing industries will come under scrutiny at the fourth Southern African Metals and Engineering Indaba taking place at the IDC Conference Centre in Sandton on Thursday and Friday this week.
“The continued survival of the M&E sector depends, as far as the domestic economy is concerned, crucially on the health and growth of the sectors which are drivers of its demand, namely mining, construction and the automotive sector. For the sector to return to profitability, demand for its products must grow. This can be through maintaining higher exports or improving domestic demand coming from the mining, construction and automotive sectors,” Steel and Engineering Industries Federation of Southern Africa (SEIFSA) Economist Marique Kruger said today.
She added that volatility in output in mining, construction and the auto sectors has implications for the domestic market for the M&E sector, which depends largely on intermediate products supplied to them. Ms Kruger said the top industries to which the sector sells its output are the construction sector (14.6%), followed by the automotive sector (12.7%) and mining (9.7%).
Commenting on the plenary session, SEIFSA CEO Kaizer Nyatsumba said the relationship between the M&E sector and mining, construction and automotive industries is of paramount importance since none of the sectors can survive without the other. He said it was against this backdrop that SEIFSA had dedicated a session to exploring and leveraging the relationship among these crucial sectors of the economy.
Taking part in the plenary session will be SEIFSA Chief Economist Michael Ade, Minerals Council South Africa Economist Tafadzwa Chibanguza, National Association of Automobile Manufacturers of South Africa Director Nico Vermeulen and Master Builders South Africa Executive Director Roy Mnisi.
Mr Nyatsumba said that other topics that will feature prominently during the 2018 Indaba include:
- The Continental Free Trade Area: How Much Progress Has Been Made to Date?
- How much of the National Development Plan has been implemented – and is it still relevant?
- Constraints to investing in the Metals and Engineering Sector and improving trade on the African continent
- Innovation and Excellence as Strategic Levers for Global Competitiveness
Among the high-profile speakers expected to address the conference are:
- Cabinet Ministers Dr Nkosazana Dlamini-Zuma, Dr Zweli Mkhize and Pravin Gordhan;
- Business leaders like Black Business Council CEO Kganki Matabane, ArcelorMittal General Manager: Africa Overland Alph Ngapo, Hazleton Pump International Managing Director Mathys Wehmer, Atlantis Foundries CEO Mervyn Moodley, Eskom CEO Phakamani Hadebe, Transnet CEO Siyabonga Gama, PWC Africa Director Andrew Shaw, National Association of Automobile Manufacturers of SA Director Nico Vermeulen and Master Builders Executive Director Roy Mnisi;
- Policy makers and civil service representatives like Department of Trade and Industry (Dti) Director-General Lionel October, and Dti Chief Director for Africa Multilateral Economic Relations Wamkele Mene;
- Representatives of global organisations like World Bank Group Lead Economist John Gabriel and International Finance Corporation Senior Investment Officer Paul Mukasa;
- Civil society leaders like Council for Scientific and Industrial Research CEO Dr Thulani Dlamini; Organisation Undoing Tax Abuse Executive Director Wayne Duvenage and Council for the Advancement of the South African Constitution Executive Secretary Lawson Naidoo; and
- Politicians like ANC Economic Transformation Head Enoch Godongwana, Democratic Alliance Shadow Minister for Trade and Industry Geordin Hill-Lewis and DA Shadow Minister for Public Enterprises Natasha Mazzone.
The Indaba will take place on 20-21 September at the IDC Conference Centre, in Sandton. For more details on the conference, please visit www.meindaba.seifsa.co.za.
Issued by:
Ollie Madlala
Communications Manager
Tel: (011) 298 9411 / 082 602 1725
Email: ollie@seifsa.co.za
Web: www.meindaba. seifsa.co.za
THE CONTINENTAL FREE TRADE AREA: ARE WE MAKING PROGRESS?
Johannesburg, 18 September 2018 – In March this year, the African Union launched the African Continental Free Trade Area (AfCFTA), with the main agreement having been signed on 22 March 2018 at an Extraordinary Summit of Heads of State in Kigale, Rwanda.
The AfCFTA is intended to build an integrated market in Africa, that will see a market of over 1 billion people with a gross domestic product of about US$2.6 trillion. The integrated market will, in turn, provide new export opportunities for South African products in West Africa, North Africa and the rest of the continent.
But just how much progress has been made to date? Steel and Engineering Industries Federation of Southern Africa (SEIFSA) Economist Marique Kruger is of the view that there is still substantial outstanding work on an Agreement on Trade in Goods and its various annexes, resulting in a substantial number of countries not having signed, pending the conclusion of all outstanding agreements and protocols.
Commenting on tariff, Ms Kruger said Ministers have agreed on a level of ambition of 90% coverage of tariff lines for tariff liberalisation, with phase-in periods of five years for most countries.
“Tariff negotiations will, however, be between countries and Regional Economic Communities (RECs) that do not already have preferential trade arrangements,” Ms Kruger said.
Commenting on some of the challenges, Ms Kruger said some RECs have internal levies for fiscal purposes that will create problems if they have to remove tariffs against other countries or RECs.
The assessment of progress made to date in the implementation of the AfCFTA and the likely implications that it will have for manufacturing in Southern Africa will be debated at the Southern African Metals and Engineering Indaba taking place at the IDC Conference Centre in Sandton on Thursday and Friday this week.
Participating in this plenary session will be Department of Trade and Industries Chief Director for Africa Multilateral Economic Relations Wamkele Mene, Africa House Director Duncan Bonnett and Trade and Investment Policy Consultant Mbini Kutta.
SEIFSA CEO Kaizer Nyatsumba said that other topics that will feature prominently during the 2018 Indaba include:
- How much of the National Development Plan has been implemented – and is it still relevant?
- Constraints to investing in the Metals and Engineering Sector and improving trade on the African continent
- Exploring and Leveraging the Link Between the Metals and Engineering Sector and the Mining, Construction and Auto Manufacturing Industries
- Radical Economic Transformation, the Black Industrialists Programme and the Metals and Engineering Sector
- Administered Prices As Factors Negatively Affecting South Africa’s International Competitiveness: Can we Change the Situation?
- Innovation and Excellence as Strategic Levers for Global Competitiveness
Among the high-profile speakers expected to address the conference are:
- Cabinet Ministers Dr Nkosazana Dlamini-Zuma, Dr Zweli Mkhize and Pravin Gordhan;
- Business leaders like Black Business Council CEO Kganki Matabane, ArcelorMittal General Manager: Africa Overland Alph Ngapo, Hazleton Pump International Managing Director Mathys Wehmer, Atlantis Foundries CEO Mervyn Moodley, Eskom CEO Phakamani Hadebe, Transnet CEO Siyabonga Gama, PWC Africa Director Andrew Shaw, National Association of Automobile Manufacturers of SA Director Nico Vermeulen and Master Builders Executive Director Roy Mnisi;
- Policy makers and civil service representatives like Department of Trade and Industry (Dti) Director-General Lionel October
- Representatives of global organisations like World Bank Group Lead Economist John Gabriel and International Finance Corporation Senior Investment Officer Paul Mukasa;
- Civil society leaders like Council for Scientific and Industrial Research CEO Dr Thulani Dlamini; Organisation Undoing Tax Abuse Executive Director Wayne Duvenage and Council for the Advancement of the South African Constitution Executive Secretary Lawson Naidoo; and
- Politicians like ANC Economic Transformation Head Enoch Godongwana, Democratic Alliance Shadow Minister for Trade and Industry Geordin Hill-Lewis and DA Shadow Minister for Public Enterprises Natasha Mazzone.
For more details on the conference, please visit www.meindaba.seifsa.co.za.
Issued by:
Ollie Madlala
Communications Manager
Tel: (011) 298 9411 / 082 602 1725
Email: ollie@seifsa.co.za
Web: www.meindaba. seifsa.co.za
TRANSNET, ESKOM AND PWC BOSSES TO DISCUSS ADMINISTERED PRICES AFFECTING SOUTH AFRICA’S INTERNATIONAL COMPETITIVENESS
Johannesburg, 16 September 2018 – Transnet and ESKOM Chief Executive Officers Siyabonga Gama and Phakamani Hadebe will discuss administered prices such as logistics costs, electricity prices and port tariffs, which are negatively affecting South Africa’s international competitiveness on the second day of the fourth Southern African Metals and Engineering Indaba taking place this week.
Participating alongside Gama and Hadebe on the plenary session will be PriceWaterhouseCoppers Director Andrew Shaw and Democratic Alliance Member of Parliament and Shadow Minister of Mining James Lorimer.
Speaking ahead of the Indaba, Steel and Engineering Industries Federation of Southern Africa (SEIFSA) Economist Marique Kruger said many companies in the primary, secondary and tertiary sectors rely on electricity for their productive processes. She said electricity was also a critical component of the metals and engineering (M&E) sector, and production processes in some of the high energy-intensive sub-components were very much dependent on it.
“Electricity costs represent on average three percent of intermediary inputs for the entire M&E sector and for some basic metals companies such as smelters and foundries, this can be a significant portion of their input costs, therebyrestricting future production capacity,” Ms Kruger said.
Furthermore, for some large companies in the steel industry, coal and energy costs represent up to 42 percent of the production costs. According to Ms Kruger, the contributory impact of high electricity cost on the sector includes a slowdown in production and growth, an increase in product prices and a decline in exports and export competitiveness.
Commenting on logistics costs, also an important cost component of the M&E sector, SEIFSA CEO Kaizer Nyatsumba said the use of third-party logistics to assist in the handling of a product adds to logistics costs. Thus, he said, there was a need to improve on logistics efficiencies to improve on productivity and competitiveness.
“There is also a need to consider re-instating rail subsidies for containers destined for export as well as improving efficiencies relating to on-time delivery and turnaround time. This is the reason we decided to have a session specifically dedicated to addressing the challenges that hinder our sector from being internationally competitive,” said Mr Nyatsumba.
He said that other topics that will feature prominently during the 2018 Indaba include:
- The Continental Free Trade Area: How Much Progress Has Been Made to Date?
- How much of the National Development Plan has been implemented – and is it still relevant?
- Exploring and Leveraging the Link Between the Metals and Engineering Sector and the Mining, Construction and Auto Manufacturing Industries
- Constraints to investing in the Metals and Engineering Sector and improving trade on the African continent
- Innovation and Excellence as Strategic Levers for Global Competitiveness
Among the high-profile speakers expected to address the conference are:
- Cabinet Ministers Dr Nkosazana Dlamini-Zuma, Dr Zweli Mkhize and Pravin Gordhan;
- Business leaders like Black Business Council CEO Kganki Matabane, ArcelorMittal General Manager: Africa Overland Alph Ngapo, Hazleton Pump International Managing Director Mathys Wehmer, Atlantis Foundries CEO Mervyn Moodley, Eskom CEO Phakamani Hadebe, Transnet CEO Siyabonga Gama, PWC Africa Director Andrew Shaw, National Association of Automobile Manufacturers of SA Director Nico Vermeulen and Master Builders Executive Director Roy Mnisi;
- Policy makers and civil service representatives like Department of Trade and Industry (Dti) Director-General Lionel October, and Dti Chief Director for Africa Multilateral Economic Relations Wamkele Mene;
- Representatives of global organisations like World Bank Group Lead Economist John Gabriel and International Finance Corporation Senior Investment Officer Paul Mukasa;
- Civil society leaders like Council for Scientific and Industrial Research CEO Dr Thulani Dlamini; Organisation Undoing Tax Abuse Executive Director Wayne Duvenage and Council for the Advancement of the South African Constitution Executive Secretary Lawson Naidoo; and
- Politicians like ANC Economic Transformation Head Enoch Godongwana, Democratic Alliance Shadow Minister for Trade and Industry Geordin Hill-Lewis and DA Shadow Minister for Public Enterprises Natasha Mazzone.
The Indaba will take place on 20-21 September at the IDC Conference Centre, in Sandton. For more details on the conference, please visit www.meindaba.seifsa.co.za.
Issued by:
Ollie Madlala
Communications Manager
Tel: (011) 298 9411 / 082 602 1725
Email: ollie@seifsa.co.za
Web: www.meindaba. seifsa.co.za