Trade union calls on government to renationalize ArcelorMittal South Africa

The South African government must “renationalize” ArcelorMittal South Africa (AMSA) to prevent job losses and revive the country’s struggling industry, according to Zwelinzima Vavi, general secretary of the South African Federation of Trade Unions (SAFTU), as reported by Bloomberg.

The company has begun closing down its long-rolling mill assets in the country, which employ about 3,500 people and support up to 100,000 indirect jobs. Nearly two years of negotiations with the government have failed to resolve AMSA’s problems, including high raw material costs and competition from cheap imports.

Job losses in South Africa are accelerating at an alarming rate, Vavi said in an interview with SAfm radio. The US’s 30% tariffs on South Africa also threaten 100,000 jobs and could prove disastrous, he said, citing estimates from the country’s central bank.

According to the union leader, SAFTU is seeking negotiations with relevant ministers to resolve the issue. In his opinion, there has been no real interaction between key players to try to find real, long-term solutions to the crisis.

Last week, Bloomberg reported, citing sources, that negotiations on the sale of ArcelorMittal’s South African division to the state-owned Industrial Development Corp (IDC) had reached an impasse due to differences in valuation. According to the agency, offers of up to 7 billion rand ($398.6 million) were discussed.

Earlier, in a statement to the Johannesburg Stock Exchange, ArcelorMittal South Africa said that they were exploring various strategic options, while IDC was conducting a comprehensive review of the company and the government was taking structural measures.

In early September, it was reported that AMSA, according to the Solidarity trade union, plans to lay off 4,000 employees, which is almost half of its workforce in the country. This number is higher than initially expected. In addition, the cuts may extend to Vanderbeilpark, the company’s flagship flat steel production facility.