Johannesburg, 13 September 2019 – The Metals and Engineering Sector Masterplan, which is currently being formulated will unlock growth opportunities for the embattled metals and engineering sector, which faces, among other challenges, rising input costs and lack of demand, Trade and Industry Minister Ebrahim Patel said this morning.
Addressing delegates attending the Southern African Metals and Engineering Indaba taking place at the IDC Conference Centre in Sandton, Minister Patel said the sector is a critical bedrock of the economy and there is a need to expand its productivity and advance its capabilities to increase the sector’s contribution to South Africa’s GDP.
Industrialisation, Minister Patel said, will be at the centre of economic recovery and there is a need to refocus on the industrial strategy.
“We are working on the Masterplan for the sector, we have met with metals and engineering sector stakeholders in an effort to ensure that they contribute to the formulation of the Plan. Subsequent to the meeting, we have received more than 40 submissions from industry players. I will be appointing a Facilitator so we can further engage the contributors and finalise the plan. The final Masterplan will be a concise, action-oriented and implementable plan,” he said.
He said Government has recommitted to the sector through the R1.5 bn steel fund and the establishment of the metal fabrication support programme. He added that Government has also played a key role in restoring Highveld Steel to become Africa’s only manufacturer of rail lines. In addition, the Minister said Government has spearheaded the initiative, which resulted in Totoya minibuses, which were previously imported, being assembled locally, thus contributing towards employment creation.
“We did the same with buses, which we previously imported from Brazil. We realised that South Africa had the capability and drove the process, to date more than 750 busses have been assembled in South Africa and not only are they assembled locally but they also boasts about 80% local content .
Furthermore, the Minister said his Department will focus on monitoring that the local content law is applied and that there is a committee to ensure consequences for non-adherence.
In conclusion, Minister Patel said enormous opportunities will also be presented by the African Continental Free Trade Agreement. Africa is the new growth frontier, it has an about $100 billion infrastructure gap, this will require at least five times the amount of steel that South Africa currently consumes. Opportunities are enormous but proper planning will be required in order for the metals and engineering sector to benefit.
In response to Minster Patel’s remarks, SEIFSA President Elias Monage stressed the need for regular engagements between Government, business and labour.
“For the M&E Masterplan to succeed, we need to move away from event-driven communication where challenges are raised then we disappear only to meet the following year and raise the same challenges. We require full commitment from all metals and engineering sector stakeholders and we need Government to provide a conducive environment for the
Masterplan to work and for the sector to grow.” Mr Monage said.