CEO Kobus Verster believes stronger protectionism with a
25% tariff would be fair
SA’s largest steel producer, ArcelorMittal SA (Amsa), has called
for a 25% tariff on imports, saying it is the most appropriate measure to
protect the embattled domestic industry.
Amsa, which is beating a path towards recovery,
has also lamented the effects of surging electricity costs on manufacturing,
while consumption has reduced.
Speaking after the group’s results presentation on Thursday, Amsa CEO Kobus
Verster said as China’s exports were forecast to accelerate 24% during the
year, many countries that produce steel had acted quickly to enact trade
remedies.
He pointed out that following Europe’s example,
countries such as Mexico had slapped tariffs on Chinese imports of about 80%,
while the US and Brazil imposed a 25% tariff. India, Vietnam, and Thailand had
taken similar actions.
SA announced two months ago it would impose an
additional 9% safeguard duty on imports of hot-rolled steel from all countries
for 200 days, starting on June 28. The provisional safeguard duty, which is
levied over and above a 10% general customs duty, has been met with mixed
reactions.
Amsa intimated that the temporary measures,
aimed at protecting the local industry from the influx of imports and exempting
developing countries, were inadequate to ensure sustainable longevity. In
addition, the enforcement of the duties was lacking.
“What we have asked for is something that
brings us in line with the protection that other countries have imposed. So if
you talk about the US it is [about] 25%. Brazil is the same, so typically that is
the type of levels that we ask for,” Verster told Business Day. “We think an
additional percentage that brings us in line with the world average of about
25% is fair.”
