South Africa: While the People Are Desperate for Jobs, the Country Is Rapidly Deindustrialising

ArcelorMittal South Africa is acutely aware of the severe consequences…

ArcelorMittal South Africa is acutely aware of the severe consequences of winding down the Long Steel business on the economy and in particular, on employment in SA.

Winding down the ArcelorMittal South Africa (AMSA) Long Steel (Longs) business would have severe impacts on South Africa’s engineering manufacturing and other sectors, with total job losses estimated at up to 120,000 and further damage being inflicted on the already fragile manufacturing sector.

Some 450,000 tonnes of the country’s current local demand of 1.7 million tonnes cannot be supplied other than by AMSA’s Longs. The ongoing congestion at the nation’s ports means that importing these supplies is not a viable short-term option.

One sector that would be particularly hard hit by a closure, is automotive, which consumes some 70,000 tonnes of Longs business outputs. Seventeen suppliers would be directly impacted by closure with seven at risk of closing and four having to reduce operations. A wind-down will set the automotive industry’s localisation programme back by at least seven years with the loss of some 7% of its unique local steel content.

In the short term, around 30,000 jobs in the automotive sector will be impacted, including suppliers and backward linkages, with this impact growing in the medium to longer term.

Since 2019, AMSA has assessed, in the utmost detail and with the deployment of high-level internal and external expert resources,…

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