AMSA closure: Sakekamer calls for urgent dialogue
The announcement in 1969 of the establishment of the third Iscor works in Newcastle (now known as AMSA) marked the beginning of the town’s transformation into an industrial powerhouse.
Over the years, the plant has become a cornerstone of Newcastle’s economy, solidifying the town’s status as a key growth point in Northern KZN.
The shock news that AMSA will close the long steel works – wiping out thousands of jobs – has put that status in jeopary with Newcastle Sakekamer President, Mornè Seaman, reflecting on how deeply AMSA’s presence has shaped the town.
“In Newcastle, you can stop and speak to almost anyone on the streets, and they will either have worked for AMSA or know someone who has,” Seaman commented.
The shutdown’s ripple effects are expected to significantly impact a variety of industries, including logistics companies, engineering firms, and downstream manufacturers who rely on the byproducts of AMSA’s operations for their own production processes.
Seaman noted that the issues leading to AMSA’s decision are not isolated to this one company but are symptomatic of broader challenges that plague businesses throughout South Africa.
Major stumbling blocks
“These issues impact every company attempting to operate in South Africa,” he explained. The major stumbling blocks include infrastructure deficiencies, access to finance, a skills gap, trade barriers, political instability, energy reliability, and burdensome regulations.”
One of the most pressing concerns, Seaman points out, is the difficulty in securing financing for manufacturing and production enterprises, as opposed to retail ventures.
“In South Africa, it’s notably easier to secure financing for building a mall than for starting a manufacturing or production enterprise, which hampers long-term economic growth and job creation,” he lamented.
For Newcastle, the potential closure of AMSA is more than just an economic blow – it’s a personal one.
The prolonged uncertainty surrounding the plant’s future has taken a toll on the employees and their families, many of whom have worked at AMSA for decades.
“With unemployment already at a high level, many long-serving employees will face significant challenges in finding new employment,” Seaman warned.
The lack of nearby cities or towns for residents to seek alternative employment only amplifies the crisis.
“Families may be forced to leave the area for better opportunities,” he said.
This migration could have far-reaching effects, potentially lowering property prices, impacting retail businesses, and further destabilising the local economy.
Call for construction dialogue
In light of these challenges, Seaman called for urgent and constructive dialogue between the local municipality, provincial government, and businesses.
“We hope this development will serve as a catalyst for open and constructive conversations. As the Newcastle Business Chamber (Sakekamer), we stand ready to facilitate these essential discussions, working collaboratively to find solutions and foster positive outcomes for our community.”
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