Why primary steelmaking is vital to South Africa's economy - Amsa

IN A TIME of global uncertainty and fierce industrial competition, South Africa must decide whether it wants to remain an industrialised economy with strategic capabilities - or become a mere consumer of others' manufactured goods.

- TAMI DIDIZA

The answer lies, in part, in whether we choose to preserve and modernise our domestic primary steel capacity.

Although the steel industry in South Africa has been damaged by the realities of the past four years, there are some early signs of revival. As the only integrated producer of flat and long steel in South Africa, ArcelorMittal South Africa (Amsa) is an irreplaceable part of that recovery and a national asset. And its preservation is a critical investment in the country's reindustrialisation, job creation, and economic sovereignty.

Primary steelmaking matters because it adds value at home. South Africa has abundant iron ore, but without local steel plants, we export this valuable mineral cheaply and import finished steel at a premium. This is a textbook example of deindustrialisation and a missed opportunity.

A functioning primary steel sector allows us to turn our natural resources into high-value inputs from girders to rails to automotive parts while creating skilled jobs, strengthening trade balances, and supporting local industries.

With integrated steel in operation, every tonne of local iron ore converted to steel domestically multiplies value across the economy. More than 3 500 direct jobs hang in the balance within Amsa's Longs Business alone, but the broader implications are far greater.

According to industry estimates, up to 80 000 downstream jobs could be at risk if the Longs Business were to shut down. If Amsa as a whole were to be lost, the implication for downstream jobs approach ranges from 350 000 to 450 000, as South Africa's industrial backbone would disintegrate. The socioeconomic ramification would be seismic.