Economic Development Minister Ebrahim Patel has welcomed a court ruling upholding the government’s new scrap metal export regulations, aimed at boosting the domestic industry.
The regulations introduced last month require scrap dealers to offer their products to domestic foundries at a preferential rate of 20 percent below the international price before they may apply for export licences.
The Metal Recyclers Association of South Africa, representing about 150 companies responsible for the collection of about 80 percent of scrap metal in the country, approached the courts for an interdict.
However, this week the Pretoria High Court ruled against them.
“The government had an obligation to make policy interventions to reverse the decline in the local foundry and scrap processing sector, which resulted in more than 10 000 job losses,” said Patel.
“I appeal to all role-players to use the new framework to rebuild the steel manufacturing industry… and strengthen the government’s R1 trillion national infrastructure build programme.”
The National Union of Metalworkers of South Africa (Numsa) has also welcomed the ruling, saying the regulations do not infringe on recyclers’ right to trade. It would now campaign for export taxes to be imposed on strategic minerals like chrome ore.
“Making Numsa happier is (the judge’s ruling) that the continued loss of employment and supply of recycled scrap metal products is a public interest matter that should supersede the alleged harm experienced by Metal Recyclers Association members.”
Patel said the national foundry technology framework would assist in revitalising the sector through skills training and technology transfers.
“We expect that the ailing metal manufacturing industries will begin to grow again, create jobs and, above all, provide the necessary industrial capacity for the infrastructure build programme.”
Much of the scrap metal industry is built on the back of street collectors. The domestic preferential price regimen follows the 2009 Second Hand Goods Act, which aims to keep out of circulation stolen metals, including copper cables, the theft of which disrupts electricity supplies and train transport at an estimated R5 billion cost to the economy. - The Argus