Response to articles published by Donald MacKay of XA International Trade Advisors on the extension of the price preference system
10 August 2021 - 09:00
byDave Kassel
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In 2009, Stats SA estimated the iron and steel industry was a direct employer of 50,000 jobs. According to its 2019 numbers, this figure has declined to about 26,000, writes The Reclamation Group’s Dave Kassel. Picture: 123RF/RIHARDZZ
In response to the recent extension of the price preference system (PPS) by minister of trade, industry & competition Ebrahim Patel, Donald MacKay of the Metal Recyclers Association (MRA) has published a number of articles criticising Patel’s decision, citing what he believes to be an economic rationale against the extension of the PPS.
MacKay acts as a consultant to the Metal Recyclers Association (MRA) on a retainer and his analysis, views, comments and allegations of bad faith must be seen and considered in this context.
As chair of The Reclamation Group, and having been intimately involved in the scrap metal industry for more than 50 years, I am well placed to comment on the industry and the views expressed by MacKay. I feel it incumbent on myself to clarify material inaccuracies and misconceptions in his articles.
The Reclamation Group, a member of the MRA, has consistently advised the MRA that it does not subscribe to litigation against the government but rather to open up channels of communication with the government to achieve a solution that’s in the best interests of SA.
The PPS was implemented in 2013 to resuscitate a once vibrant foundry and steelmaking industry, and has been subject to many amendments and extensions over the past eight years. The scrap recycling industry has operated profitably under the PPS. The latest extension has not decreased the PPS price, or increased the local discount, and the economic consequences will be no different to the recycling industry now under an extension than the factual experience.
The application of the export duty and PPS are mutually exclusive in application and will not run in parallel because they cannot happen or apply at the same time in respect of the same parcel of material.
Patel’s decision to extend the PPS was not based on a compromised process. He invited comments from the public and a broad spectrum of industry and considered all comments received as well as the recommendation of the Steel Masterplan Committee before making a decision.
All industry players need to recognise that no industry in our country can operate as an island. All industries need to consider and balance the best interests of SA as a whole.
Read the full response below:
This article was paid for by The Reclamation Group.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
PPS — A lifeline for the SA steel industry
Response to articles published by Donald MacKay of XA International Trade Advisors on the extension of the price preference system
In response to the recent extension of the price preference system (PPS) by minister of trade, industry & competition Ebrahim Patel, Donald MacKay of the Metal Recyclers Association (MRA) has published a number of articles criticising Patel’s decision, citing what he believes to be an economic rationale against the extension of the PPS.
MacKay acts as a consultant to the Metal Recyclers Association (MRA) on a retainer and his analysis, views, comments and allegations of bad faith must be seen and considered in this context.
As chair of The Reclamation Group, and having been intimately involved in the scrap metal industry for more than 50 years, I am well placed to comment on the industry and the views expressed by MacKay. I feel it incumbent on myself to clarify material inaccuracies and misconceptions in his articles.
The Reclamation Group, a member of the MRA, has consistently advised the MRA that it does not subscribe to litigation against the government but rather to open up channels of communication with the government to achieve a solution that’s in the best interests of SA.
The PPS was implemented in 2013 to resuscitate a once vibrant foundry and steelmaking industry, and has been subject to many amendments and extensions over the past eight years. The scrap recycling industry has operated profitably under the PPS. The latest extension has not decreased the PPS price, or increased the local discount, and the economic consequences will be no different to the recycling industry now under an extension than the factual experience.
The application of the export duty and PPS are mutually exclusive in application and will not run in parallel because they cannot happen or apply at the same time in respect of the same parcel of material.
Patel’s decision to extend the PPS was not based on a compromised process. He invited comments from the public and a broad spectrum of industry and considered all comments received as well as the recommendation of the Steel Masterplan Committee before making a decision.
All industry players need to recognise that no industry in our country can operate as an island. All industries need to consider and balance the best interests of SA as a whole.
Read the full response below:
This article was paid for by The Reclamation Group.
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