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CEO’S REPORT
A TOUGH YEAR The year 2014/15 was very difficult for the South African economy in general and the metals and engineering sector in particular. The violent, month-long strike at the beginning of the financial year meant that companies in the sector and, to an extent, in the three related industries to which our sector is a supplier began 2014/15 in the worst manner possible. The fact that the strike in the metals and engineering sector followed the five-month-long one in platinum mining made matters worse. Unfortunately, the situation did not improve much during the rest of the financial year. While some companies in some sub-sectors of our industry managed to report good or decent economic performances, by and large the majority of companies fared terribly, with many reporting huge losses at the end of the year. Predictably, they have had to undertake a serious review of their cost structures, and in the process some have had to shed jobs. Worse still, some have found themselves going under or in business rescue. With SEIFSA deriving its revenue from membership fees and the various expert training and consulting services that it offers across its five Divisions – Economics and Commercial; Industrial Relations; Legal; Human Capital and Skills Development (which includes the SEIFSA Training Centre); as well as Safety, Health, Environment and Quality – it could not but be similarly affected by the state of the economy and the poor performance of the metals and engineering sector. A detailed financial report for the year follows in the next session. Since the products and services offered by SEIFSA are generic in nature and are not of exclusive use or relevance to the metals and engineering sector, we have worked hard during the year under review to market our services not only beyond the SEIFSA membership base in the sector, but also to companies
SEIFSA ANNUAL REVIEW 2015
in other industries in the broader economy. We will continue to do so in 2015/16 and beyond. Given the parlous state of the economy, SEIFSA has been at the forefront of calls for the Government to impose import tariffs to protect local manufacturers against unfair competition which amounts to dumping. For the very first time in SEIFSA’s history, from November 2013 and in the year under review the Federation’s voice was heard loudly and clearly in the media, eloquently articulating the concerns of its members. SEIFSA alone spoke out against the bloated Cabinet when it was appointed after the 2014 general elections. It is, without doubt, one of the biggest Cabinets in the world, and not only among countries that are democracies. We have repeatedly called on the Government to reconsider its unwise decision to impose carbon taxes on business – at a time when the economy is seriously ailing. We have called for greater policy coherence at Government level and pleaded with Pretoria to review its adversarial approach to business and embrace the latter as the major strategic partner that it is. We held a high-level meeting with the Governor of the Reserve Bank and his team, opposed Eskom’s application to NERSA for higher electricity tariffs and quantified the devastating impact of load shedding on the metals and engineering sector. During the year under review, SEIFSA generated publicity worth R150 million, as quantified by independent media monitoring company Newsclip. Chief Economist Henk Langenhoven and the CEO
