The Congress of South African Trade Unions (COSATU) welcomes government efforts to keep ArcelorMittal South Africa (AMSA)’s Newcastle and Vereeniging long steel mills open, and by so doing safeguard 3 500 jobs.

The latest measure involves a R1.7 billion loan from state-owned Industrial Development Corporation (IDC). The loan will enable AMSA to keep the Newcastle plant operational for six months while a long-term sustainable solution is sought.

Panic set in early this year when AMSA announced it would be shutting the mills in the two provinces and killing 3 500 direct and indirect jobs as a result.

Last month the Department of Trade, Industry and Competition (DTIC) said the IDC had provided a R380 million injection to AMSA in February, in addition to the R1 billion working capital facility it had extended in June last year. While the Unemployment Insurance Fund’s Temporary Employee/Employer Relief Scheme (TERS) said it had approved funding to the tune of R417 million to cover workers’ salaries for the next 12 months. The support was said to be conditional on AMSA participating in the Productivity SA turnaround and recovery programme.

Following these interventions, the retrenchment of 3 500 workers will be suspended. Government will use the six-month period brought about by the loan to look into and address the structural impediments identified by AMSA as well as the policy on scrap and tariff measures.

COSATU is wholly supportive of government efforts to protect the steel industry and safeguard jobs. Given the country’s shockingly high unemployment rate of 41.6%, we simply cannot afford to lose a single job. The Federation reiterates its willingness to work with various stakeholders to tackle challenges impacting the steel industry. 

Issued by COSATU

Zanele Sabela (COSATU National Spokesperson)

Mobile: 079 287 5788 / 077 600 6639

Email: zaneles@cosatu.org.za