ArcelorMittal plans to shut South Africa plant, 900 workers to lose jobs

Representative Image

Scores of workers in South Africa picketed at steel giant ArcelorMittal's plant in the town of Saldanha on Thursday demanding a halt in plans to close the operation which would see 900 jobs lost.

ArcelorMittal announced early this month that it would wind down the plant, 175 kilometres (110 miles) north of Cape Town, because it was no longer viable on the export market.

The plant has "incurred substantial losses in the past," said the company, adding that the "medium-term outlook remain bleak".

But closing down the operation will mean extensive job losses in the small West Coast town of around 28,000 people, which is heavily dependent on the plant.

Saldanha became operational in 1998 and employs 400 fulltime staff and 500 contract workers.

"When the steel works closes, it means a thousand direct jobs ... will be lost," said Sammy Claassen, spokesman for a community support group, the South African Social and Economic Development Forum, said during the protest.

According to Claassen, if subcontractors are added, around 4,000 people will be affected by the closure of the steel factory.

"There will be absolute poverty, absolute devastation and chaos, crime and unemployment," said Claassen in the small town that was originally built on the fishing industry.

The town faced similar devastation when big fish factories closed down in the early 1990s, before the steel plant opened in 1998. "Our town became a ghost town, our people weren't working," said 67-year-old community member Pauline Mali.

And "if the steelworks closes we'll be back to where we come from," she added.

ArcelorMittal, which supplies more than 70 percent of South Africa's steel, announced in July that it could slash nearly a quarter of its 8,000-strong workforce throughout South Africa as part of a restructuring project.



Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel