The Newcastle Growth Coalition Chapter will ‘do everything possible to save AMSA’
Having made a general calculation of the loss, Pieters said the town would suffer a loss of at least R428 180 000 a year.
Johan Pieters of the Newcastle Growth Coalition Chapter told the Advertiser that meetings had been held with Kobus Verster and his representatives and with Trade and Investment KZN (TIKZN) in a bid to save the Newcastle Works.
“There are three fundamentals that need attention and as Kobus said, he doesn’t want any freebies but would like a competitive market in which to conduct business.
“Although AMSA is not making a profit at this stage, as long as they can break even, they will be happy to keep the place going.”
The three fundamentals that need to be addressed are an R250 discount per ton on delivered AMSA goods to the harbour and at all other areas under Transnet. A 15% discount on AMSA’s Eskom tariffs and an urgent intervention on the scrap metal ban are also critical.
“Remember, AMSA are the ones that manufacture Longs steel products – so if they close down that affects means the upstream and the downstream. You’re not just talking about Newcastle and Vereeniging; you’re talking about thousands of people who will lose their jobs across South Africa. So it’s not just a local problem; it’s a national problem because other smaller role players will also be forced to close down. After all, they will no longer be able to receive products from AMSA. Longs steel products will have to be imported as these will no longer be manufactured locally.”
Answering allegations that workers had been offered retrenchment packages, including a three-month salary and their pension funds, Pieters believed that no worker could have been issued with these retrenchment package deals ‘as the Section 189 process was a lengthy process that could in no way be done in a matter of 24 hours.’
The economic impact will be enormous
“The Section 189 process is only going out now – they first need to have their discussions with the Unions, after only that will workers receive the necessary documentation. Yes, they’ve received letters informing them of what is going to happen but not retrenchment agreements.”
Elaborating on the impact this will have on Newcastle’s economy, Pieters explained that with 2351 people being retrenched the effect will be enormous.
Having made a general calculation of the loss, Pieters said if the 2351 employees being retrenched earned on average a salary of R15 000 per person, the town would suffer a loss of at least R428 180 000 a year.
“It is not only the people who work at Mittal who will be affected but also smaller companies that supply goods and services to Mittal. I read that people might be absorbed into other plants but that means people will be leaving Newcastle and we don’t want that – especially our qualified and skilled workers.
“What we want is an amicable solution between AMSA and the Government to keep the works going. We are going to fight to save the plant until we cannot fight anymore,” he said. “The reason why we’re getting involved is because we want to sort out those three fundamentals. The only way we can achieve this is to get provincial and national Government involved. If those spheres of government get involved, we are positive that the Newcastle Business Growth Coalition can assist in saving the Newcastle Works.
“The doors are not closed, not at all; there are a lot of other opportunities including getting a private buyer to take over the plant as is with its current staff complement. “They can also get an equity partner involved. But as Kobus stated, they are the best in the world when it comes to steel but if someone is interested in buying the plant, they would consider selling in the right market, but they also don’t believe anyone is going to want to buy a company that is running at a loss,” Pieters explained.
This was confirmed by Verster who believed that if they (AMSA) could not turn things around considering the hurdles and challenges they faced, no other buyer would be exempt from the same challenges.
Going forward, Pieters said that although the closure would be detrimental, he wanted to remain positive and focus on what could be done to save AMSA Newcastle Works, which he believed could be achieved through hard work and government dedication.
“Newcastle has faced this sort of challenge before and survived. We stood up and rebuilt and grew stronger. We can do it again – we always do. So we will remain positive and hopeful and we will continue to fight for a company that has been a part of our Newcastle history since the 1970s when Yskor first opened their doors here,” he concluded.
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