South Africa has, over the years, experienced frequent energy supply shortages. In addition, uncertainty about the security of its supply going forward as well as constant reports of delays in solving supply challenges are bound not only to impact negatively on South Africa’s already ailing economy, but also to change how the country is perceived as an investment destination, the Steel and Engineering Industries Federation of Southern Africa (SEIFSA) said today.

SEIFSA Chief Executive Officer Kaizer Nyatsumba said that, on average, energy costs in the metals and engineering sector account for about 8% of intermediary input costs. He said that it stood to reason that, without reliable energy supply, the sector cannot grow.

He added that it was unfortunate that even right now the sector could not operate at full capacity as a result, among other things, of energy constraints.

“Actual or realized economic growth in the South African economy has fallen substantially below its potential. While energy provision should support our growth ambitions, there appears to be a real danger of the two gradually drifting apart,” said Mr Nyatsumba.

Mr Nyatsumba said that it was regrettable that electricity generation had become a significant physical constraint that hampered the economy’s ability to grow at a faster rate. He said that the situation ran counter to the Government’s stated intention to stimulate local manufacturing and value addition.

Electricity constraint and its impact on South Africa’s economic growth will be discussed robustly on the first day of the upcoming two-day Southern African Metals and Engineering Indaba scheduled to take place on 28 and 29 May at Emperors Palace, in Ekurhuleni.

Debating this issue and providing sustainable solutions will be a panel comprising:

  • Democratic Alliance Shadow Minister of Public Enterprises Natasha Mazzone,
  • Democratic Alliance Shadow Minister of Cooperative Governance and Traditional Affairs Kevin Mileham,
  • EE Publishing Managing Director Chris Yelland, and
  • Karpowership Company Limited Sales Director Patrick O’Driscoll (UAE).

Also invited to be part of the panel discussion are Energy Minister Tina Joemat-Petterson, Public Enterprises Minister Lynne Brown, Eskom CEO Brian Molefe and Johannesburg City Power Managing Director Sicelo Xulu.

To be attended by policy and decision makers, business owners, senior executives and other stakeholders in the metals and engineering sector in the Southern African Development Community, the Metals and Engineering Indaba will focus on the following topics, among others:

  • Does Manufacturing Have a Future in Southern Africa?
  • Striking a Healthy Balance Between International Competition and Dumping
  • Transformation in the Metals and Engineering Sector
  • International Competitiveness and Intra-African Trade
  • South Africa and the National Development Plan
  • Southern Africa and the Huge Infrastructure Backlog – How To Finance It?
  • South Africa’s Electricity Constraint and its Impact on the Economy

The Indaba will bring together business owners, trade unionists and policymakers from across the Southern African Development Community to deliberate on strategies to revive manufacturing in general and the metals and engineering sector in particular.