Johannesburg, 24 October 2018 – The Steel and Engineering Industries Federation of Southern Africa (SEIFSA) welcomes the decision by the US Department of Commerce (DoC) to exclude some of South Africa’s steel and aluminium products from the section 232 tariffs, initially put in place by the Trump administration on the basis of safeguarding US national security, SEIFSA Chief Economist Michael Ade said this evening.

Following months of intense negotiations and lobbying by the South African Government with its US counterpart for a possible reprieve on a 25% steel and 10% aluminium import tariffs, there seems to be some light at the end of the tunnel for South African businesses which export products to the US market as the DoC granted product exemptions for 161 aluminium and 36 steel products.

“This is really good news for South African companies which export to the US market. Hitherto, local companies had increasingly grown worried about the possibility of losing US market share and also not having existing contracts renewed upon expiration,” Dr Ade said.

In addition, the concern was that US steel- and aluminium-consuming companies may seek certainty by buying intermediate products from countries that have been exempted from the import tariffs.

“The decision by the US DoC, therefore, provides a degree of comfort to local companies at a time when local demand is very low and companies are increasingly turning to regional and international markets to sell their intermediary products. The decision is equally good news for the US-based companies that had made submissions to the DoC for exclusions on a case-by-case basis. It permits the successful applicants to plan productive processes in advance,” said Dr Ade.

He added that the US DoC’s decision to exempt some of South Africa’s aluminum and steel products also highlighted the power of local stakeholders jointly mobilising efforts in dealing with perceived challenges. Dr Ade said both the local industry and the Department of Trade and Industry (DTI) have a reason to feel vindicated for having put the interests of the country first and reaffirmed their earlier arguments that SA exports to the US do not constitute a threat to the US economy. Instead, local steel and aluminium exports to the US are key intermediary inputs to manufactured US consumer and business goods.

“SEIFSA gratefully acknowledges the contribution of our Government and specifically lauds the DTI in making significant progress in this regard. The metals and engineering cluster will not relent and will continue to support the efforts of Government in highlighting the importance of the country’s products being exported to the US markets, as a source of strategic intermediate inputs to the US manufacturing, utility and construction sectors.

“SEIFSA further encourages local companies to continue to persuade their US counterparts to apply for more exemptions as there is scope to improve the current exemption lines,” Dr Ade said.

In conclusion, Dr Ade said that both the South African Government and the local industry should continue to engage the US government to eventually cancel the applicable import tariffs on all steel and aluminum products exports to the US.

“There is strength in a united approach and it is evident that the collaboration between the Government and the local steel industry gives proof of the maxim that hard work helps anyone to move mountains,” he said.


Issued by:

Ollie Madlala

Communications Manager

Tel: (011) 298 9411 / 082 602 1725


Web: www.meindaba.