LEBO RADEBE | Keep Africa’s steel in African hands

South Africa’s manufacturing industry is on the precipice as the future of Arcelor Mittal South Africa (Amsa) hangs in the balance, with international vultures circling to ensure its extermination.

While the future of Amsa is under review in boardrooms, the government, labour and the manufacturing sector, steady offers to save the giant steel company and keep it in the hands of local people have been put on the table.

What boggles the mind is that had there been a genuine desire to save the company, these offers would have been snapped up and thousands of jobs saved.

As the South African Manufacturers Foundation (SAMF), we have to ask this obvious question: is this purely due to the lack of a political will, or are other, sinister motives at play?

Steel is a strategic asset. It is critical who should own and control Africa’s industrial backbone.

Once a thriving steel industry, it now finds itself at a crossroads. It is facing a crisis that threatens jobs, economic stability and the industrial future.

The recipe for the disaster is well documented: rising energy costs, outdated infrastructure, cheaper imports, especially from China, unreliable rail logistics, weak local demand and a lack of government infrastructure spending, all of which have pushed it to the brink.

Yet this is the industry that underpins infrastructure, housing, mining, transport, energy and manufacturing. Countries that cede control of steel cede control of development.

For the SAMF, one principle must guide any Amsa deal: It must prioritise African ownership, African control and African industrial objectives.

In recent months, Amsa has retrenched up to 5,000 workers, condemning them to abject poverty — in sharp contrast to the government’s repeated commitment to help stabilise the company.

Amsa is closing its long steel operations due largely, it has said, to a lack of government support. A struggling economy and policies leaning towards scrap-based mini mills over raw material has added fuel to the fire.

Workers are in limbo. At issue is the valuation gap for the potential sale to the Industrial Development Corporation with talks of R7bn on the table while Amsa is said to demand considerably more.

We believe that public capital should protect jobs and drive industrial expansion — not socialise losses while employment shrinks. Talking about revival while cutting thousands of jobs raises serious questions about alignment between policy and practice.

African players raising their hands should be rewarded and given a chance. Industrial policy cannot be ownership-neutral. Ownership determines where profits flow, where strategy is set, and whether long-term national and continental interests outweigh short-term balance sheet gains.

The government came up with the South African Steel and Metal Fabrication Master Plan in 2021 and touted it as the strategy to revitalise the sector and drive growth.

But a Stellenbosch Business School evaluation found the plan struggled to take on the fundamental issues crippling the industry.

The old narrative that African capital is absent or unprepared can no longer fly. South African firms such as Networth Investments have submitted proposals to acquire Amsa, and these have been backed by committed capital and turnaround plans.

An African-backed consortium has tabled a R5bn offer for steel assets — a concrete indication that African ownership is viable at scale. These are not symbolic gestures. They are serious offers that challenge the assumption that Africa must outsource control of its most strategic industries.

With African control, steel can:

• Anchor downstream manufacturing;
• Support rail, construction, automotive and green infrastructure;
• Strengthen regional supply chains under the African Continental Free trade Agreement; and
• Retain skills, profits and decision-making on the continent.

Without this, Africa repeats a familiar cycle: exporting value and importing dependency.

The Amsa decision will echo beyond South Africa. Across the continent, governments face the same choice: preserve strategic industries through inclusive, development-led ownership, or default to models that prioritise short-term relief over long-term industrial sovereignty.

One path preserves the status quo: concentrated ownership, weak competition and recurring job losses. The other builds African ownership, industrial depth, jobs and shared prosperity.

Moment to act

The SAMF’s view is clear. Alternatives exist. They are African. They are credible. They are financed. They are ready. What remains is whether African institutions will back them. If this moment is missed, it will not be for lack of options, but for lack of resolve.

If it is seized, Amsa can become a symbol not of decline, but of Africa reclaiming its industrial future. The steel that builds Africa should be owned by Africa.

Lebo Radebe is acting CEO of the South African Manufacturers’ Foundation