R1 billion bailout on the cards for AMSA to save 100,000 jobs in South Africa

VANDERBIJLPARK - Government officials are reportedly earmarking a R1-billion bailout for ArcelorMittal South Africa (AMSA) after it announced it would close its Longs Steel business in Vereeniging and Newcastle. Earlier this month, AMSA said it had no choice but to wind down its longs business amid high energy costs, logistics constraints and an export scrap tax issue. Although AMSA engaged with stakeholders throughout 2023 to find a solution, it said that the package of initiatives sought would not change the fundamentals of the structural problems. The group said that its decision would affect about 3,500 direct and indirect jobs, but due to the importance of the steel sector to other parts of the economy, there is a belief that job losses could rise to 100,000 by the year-end. Business Times reports efforts are now underway by the government to create a rescue package for AMSA’s embattled steel mills. Business Times said that Department of Trade, Industry and Competition (DTIC) Minister Parks Tau and Finance Minister Enoch Godongwana have created a draft rescue package of up to R1-billion.