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Steel Industry: the war on import duties (AMSA vs the steel downstream)

Steel Industry: the war on import duties (AMSA vs the steel downstream)

Earlier this month, NEASA filed an urgent application in the Gauteng High Court to prevent Government from introducing more tariffs on nine new product codes – some of which are not even manufactured in South Africa.

This application consisted of two parts:

  • firstly, the urgent application was aimed at preventing ITAC from recommending to the Minister of Trade, Industry and Competition to introduce the duties; and
  • secondly, to take any decision to introduce these duties on review.

In ITAC’s answering affidavit, they indicated that they have made a decision but are not at liberty to disclose whether it is for or against the duties. Also clearly stipulated in their court papers, is that neither the Minister of Trade, Industry and Competition or the Minister of Finance will “rubber stamp” the recommendation of ITAC and that both these ministers have a duty to “apply their minds” before any duties are introduced. It is on this basis that the decision was made to withdraw the urgent application.

Consequently, NEASA has addressed communiques to both the Minister of Trade, Industry and Competition (to view click here) and the Minister of Finance (to view click here) in order to, once again, explain the steel downstream’s predicament.

It was, among others, brought to the attention of both these ministers that AMSA did not fully start-up after lockdown and admittedly cannot fully supply the market. This has a domino effect on the entire industry and notices have been issued by various role players in the steel production chain that material is not available. The nine new tariff codes that AMSA has applied for directly relates to the products that are now unavailable.

Should the relevant ministers indeed apply their minds, they should realise that introducing import duties is not in the industry’s interest. However, only time will tell if they will indeed come to this realisation.