In the first instalment of this analysis I looked at the measures proposed by “The SA Steel and Metal Fabrication Master Plan 1.0” to stabilise the industry. In part 2, I will look at some of the key issues identified to grow the industry.
For the purposes of this piece, let us look at the following growth measures proposed by the master plan: an infrastructure drive, localisation, export promotion and joint vehicles for export promotion, climate resilience and greening of the industry, development of industry value chains, reducing the administrative burden on doing business, as well as the alignment of incentives and regulations.
Therefore, the relatively limited opportunities provided for in the master plan, such as housing projects under the department of human settlements and liquefied petroleum gas and solar geysers under the Department of Energy, are not sufficient. Furthermore, the brief reference to road and rail opportunities are more of a courtesy than a reality; one only needs to step out of one’s front door to see the state of our road and rail network.
The commentariat, as well as the DA, have all voiced concerns regarding the impracticality of the localisation drive on the basis of price competitiveness, quality and local production capacity. Former DA leader Tony Leon humorously referred to it as Ebrahim Patel’s protectionist “localisation” frolic. It is no different in the steel industry.
However, it will be interesting to see whether more details will be forthcoming in terms of possible exemptions for joint vehicles for export promotion into the continent. Such vehicles have the ability to improve economies of scale, but may fall foul of certain legislative requirements and ideological dogma.
Developing industry value chains goes without saying, and the automotive sector has the ability to unlock new opportunities for the downstream sector in particular. However, Patel needs to resist the urge to be too prescriptive in this regard, as it may lead to an increase in the price and a reduction in the quality of components produced as in the case of other products designated for localisation.
Patel is useless.
What's very apparent is the capture of CR cabinet that's perpetuating policies of the WMC/NWO at all levels dictatorship.
Soviet apparatchiks think you enable when you regulate and control everything centrally. They also never learn from their mistakes. Stuck in a rut behind the iron curtain. EbrahimPatel. the_dti
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