Localisation policies and incentives for manufacturers must be restored and expanded to shield the South African economy from further de-industrialisation, with the closure of steel producer ArcelorMittal South Africa's Vereeniging and Newcastle plants threatening localisation, jobs and the broader industrial economy, says industry organisation Mining Equipment Manufacturers of South Africa (Memsa) interim CEO Juliana Makapan.

Steel is a critical input for the manufacturing industry and its local availability directly affects sectors such as mining equipment manufacturing, construction and automotive production. Competing with cheap imports, which are often subsidised by foreign governments, undermines the viability of local industries.

“We need policies that prioritise local over foreign steel,” Makapan emphasises.

With the closure of key steel plants, manufacturers face rising costs from importing raw materials, which undermines their competitiveness and disrupts supply chains. These challenges weaken efforts to localise production and place additional strain on businesses already grappling with a turbulent economy and inconsistent policy implementation.

Industries are deeply interconnected and the fallout from these plant closures poses a severe threat to the sustainability of mining equipment manufacturing and other industrial sectors.

South Africa’s mining equipment manufacturers rely heavily on the availability of locally produced steel, Makapan says.

“Memsa calls on government to urgently address the policy and leadership gaps that have led to this crisis. It must increase the resilience of domestic manufacturers, including mining equipment manufacturers, as this is pivotal for achieving inclusive economic growth.”

Stabilising the steel industry is not about one sector, but rather it is about securing the future of local industries and protecting jobs across the board, she says.

To address the crisis, Memsa calls on the Department of Trade, Industry and Competition (dtic) to expedite interventions to secure the supply of affordable local steel and to enhance and restore localisation incentives for domestic manufacturers.

It further calls on the dtic to engage industry stakeholders in transparent dialogue to implement the Steel Master Plan (SMP) effectively, as well as to collaborate across sectors to mitigate the impact of de-industrialisation and strengthen economic policy frameworks.

Memsa has actively contributed to steel sector policy through submissions to the SMP, which highlighted industry-wide concerns and presented actionable recommendations to support steel manufacturing, boost localisation and incentivise growth within industrial sectors.

The lack of follow-through on these recommendations underscores systemic gaps in translating policy proposals into tangible outcomes, notes Makapan.

“The challenges we face are not insurmountable, but solutions require action. Government intervention is no longer optional; it is essential,” she says.

By working together, government, local manufacturers and industry leaders can build a future where local industries thrive, supply chains remain resilient, and jobs are preserved and created.

Failure to act decisively risks the collapse of manufacturing industries, as well as the erosion of South Africa’s capacity to innovate and create sustainable jobs.