The South African Federation of Trade Unions (SAFTU) condemn, in the strongest
possible terms, ArcelorMittal South Africa’s (AMSA) announcement that it is closing its long steel operations in Newcastle and Vereeniging, and placing Vanderbijlpark’s future at risk.
This catastrophic decision will devastate thousands of workers, their families, and
entire communities, while driving South Africa’s steel sector and manufacturing base closer to total collapse.
Privatisation Betrayal: ISCOR’s Destruction
The current disaster stems directly from the apartheid regime’s privatisation of ISCOR in 1989. Successive democratic governments failed to reverse this betrayal, leaving our steel industry under foreign corporate control.
Since privatisation, tens of thousands of jobs have been wiped out. Vanderbijlpark
alone has lost 10,000 jobs since 1990. Now, with Newcastle and Vereeniging slated for closure, another 4,000 workers face retrenchment, while downstream industries and communities stand on the edge of collapse.
Billions in Public Funds, still a Shutdown
AMSA’s actions amount to corporate plunder. Over the past 18 months, the company has demanded and received enormous public subsidies with no binding conditions to
protect jobs or local production:
- R1 billion from the Industrial Development Corporation (IDC) in June 2024
- R380 million in early 2025
- R1.683 billion in March 2025 to delay plant closures
- R417 million in UIF/TERS wage support for nearly 3,000 workers
Despite this R3.4 billion-plus rescue package, AMSA is closing plants and retrenching workers in large numbers.
The National Energy Regulator of South Africa (NERSA) has even granted AMSA a special discounted electricity tariff, despite Eskom’s rejection of the application, proving the state continues to prioritise corporate demands over workers livelihoods.
CEO KOBUS VERSTER: PROFITS OVER PEOPLE
The hypocrisy of AMSA’s leadership must be exposed. CEO Kobus Verster reportedly
earns over R20 million annually in salary, bonuses, and share-linked incentives, while
demanding bailouts from taxpayers and laying off thousands of workers. This is a
blatant transfer of public wealth to corporate executives and foreign shareholders.
For decades, AMSA has abused South Africa’s resources. Former Trade & Industry Minister Rob Davies wrote in 2015 that AMSA extracted “excessive returns,” failed to invest in maintenance, and crippled downstream manufacturing competitiveness.
Those profits were not reinvested in South Africa but siphoned to AMSA’s Luxembourg headquarters.
Privatisation Has Failed South Africa
AMSA’s collapse is part of a wider pattern of neoliberal failure:
- Telkom’s 1997 privatisation caused 51,000 job losses by 2015, gutted landline
infrastructure, and shifted costs onto poor households. - SAA’s failed privatisations, with Swissair in the late 1990s, then Takatso in the 2020s,left the airline in ruins.
- SASOL’s 1979 privatisation funnelled profits overseas, including a $13bn U.S.
disaster project with 60% cost overruns. - Eskom has been crippled through outsourcing scandals like the Chancellor HouseHitachi deal, which was prosecuted in the U.S. but not in South Africa.
- Secret Independent Power Producer (IPP) contracts locked Eskom out of renewables
for years, entrenching private-sector dominance and sabotaging Eskom’s ability to lead a just energy transition. - Public services, from Transnet and PRASA to the Post Office, were gutted under the banner of “efficiency,” resulting in collapsed services and mass unemployment.
Privatisation has destroyed jobs, raised prices, and handed strategic assets to foreign corporations. AMSA is proof that this economic model has failed South Africa.
A Looming Industrial Blackout
With AMSA shutting its long steel operations, South Africa faces the loss of its last integrated carbon steel capacity. Smaller minimills cannot produce the required volumes or specialised products for automotive, construction, mining, and rail.This will make us wholly dependent on imported steel, vulnerable to global pricing
manipulation, and stripped of industrial sovereignty.
Raw-Out, Finished-In: The Colonial Trap South Africa continues to export millions of tonnes of chrome ore, 47.8% to China in 2023, where it is stockpiled and priced abroad, before being re-imported as cheap finished steel. ITAC has repeatedly found Chinese steel dumping, yet the state has acted too slowly to protect local production.
This crisis is compounded by Trump’s escalating tariffs (50% on steel and aluminium in February), which displaced global steel supply into fragile markets like South Africa.
The Ramaphosa administration’s neoliberal subservience has left us defenceless, rather than building a BRICS-wide strategy to protect local industries from dumping and trade wars.
Deindustrialisation by Design
Manufacturing’s share of GDP has fallen from 20% in 1994 to 11–13% today, with over
430,000 factory jobs lost since 2008. AMSA’s closure will:
- Erase 11.4% of Newcastle’s total GVA and 64% of its manufacturing GVA, risking
60,000–80,000 downstream jobs. - Hit automotive supply chains, placing 13,000 additional jobs at risk.
These are not “market forces.” They are policy choices driven by neoliberalism,
austerity, and corporate greed.
Parliamentary Inquiry and Accountability.
SAFTU demands a full parliamentary inquiry into:
- AMSA’s use of R3.4 billion in public funds and its special electricity tariffs;
- The secretive IPP contracts that weakened Eskom and entrenched private energy monopolies;
- The state’s failure to protect strategic industries, jobs, and communities.
This inquiry must hold AMSA executives and policymakers accountable for decades of looting, profiteering, and deliberate deindustrialisation.
SAFTU DEMANDS
We demand bold, immediate intervention:
- Renationalise AMSA under worker-state co-ownership and democratic control.
- Impose export taxes and beneficiation mandates for chrome, iron ore, and other
strategic minerals. - Enforce strict anti-dumping measures and tariffs to shield local steel and
manufacturing. - Implement a national reindustrialisation plan with massive public investment in steel, rail, ports, and energy.
- Create a jobs rescue package for communities in Newcastle, Vereeniging, and Vanderbijlpark.
- End austerity and pursue a worker-led economic transformation plan.
- Redirect the R248bn Just Energy Transition Partnership funds to secure industrial jobs and a just transition, instead of bankrolling foreign consultancies.
Conclusion: A Fight for Steel, Jobs, and Sovereignty AMSA’s closure is a national emergency. Decades of privatisation and neoliberalism have gutted our productive base, enriched foreign shareholders, and condemned workers to mass unemployment.
We call on workers, unions, and communities to mobilise against this betrayal. Nationalise AMSA, reclaim our steel industry, and place South Africa’s economic future under democratic, worker-led control.
This struggle is not just about steel; it is a fight for sovereignty, dignity, and a just
economic future.
A Statement was issued on behalf of SAFTU General Secretary Zwelinzima Vavi.
For media enquiries, contact the National Spokesperson at:
Newton Masuku
0661682157
Newton@saftu.org.za
