COSATU calls on government to halt closure of Arcelor Mittal’s Saldanha Bay Steel Plant

COSATU is deeply alarmed and concerned about Arcelor Mittal’s (AMSA) intention to close its Saldanha steel plant. The closure will affect about 900 workers at the plant but also 1200 sub-contracted workers, the entire Saldanha Bay economy and the steel industry value chain.

The economy of Saldanha is already suffering from high levels of unemployment and this will have a spillover impact on the entire West Coast District. This plant is key to the beneficiation drive in South Africa and provides important inputs into the downstream industries. This plant forms an integral part of the Sectoral Master Plan for South Africa’s steel and engineering Industry.  As one of only two steel-producing African nations, the plant plays a critical role in the continent’s infrastructure development.  AMSA’s actions undermine the progressive efforts of the government to attract investments to South Africa’s fragile economy.

We urge the government to intervene urgently to stop this looming disaster.  The federation agrees with the call by the Minister for Trade, Industry and Competition, Ebrahim Patel that if AMSA is not willing to save the plant, then they must sell it.

The Saldanha Bay Steel Mill was built to ensure that we add value to the raw materials in South Africa. The sale to AMSA was clearly a mistake (under the privatisation push) as we can now see that companies have little regard for the social consequences of their actions. The oversupply of steel globally is a temporary situation and can be addressed by several internal measures that support domestic producers in South Africa. The government has already pushed for the adjustments to import duties, cheaper electricity and Transnet tariffs. 

To help save this strategic company for the South African economy, the government must assist to ensure that the various input costs are reduced e.g. steel supply, electricity and transport costs.

The federation believes that urgent decisive efforts driven by the Government can ensure the survival of Saldanha Steel and the development of a coherent industrial strategy for the steel and engineering sector.  Parliament’s Trade and Industry Portfolio and Select Committees equally must convene an urgent meeting with government, industry and labour to ensure a rapid response is put in place to stop this closure and jobs bloodbath.

For further information contact Tony Ehrenreich at 082 773 3194 or Matthew Parks at 082 785 0687.