CONSTRUCTION
During his recent 2019 State of the Nation Address (SoNA), President Ramaphosa reiterated the government’s commitment to infrastructure spend and said that R250-billion worth of projects have “entered implementation phase”
space to advance. The government’s commitment to infrastructure development coupled with the support of the private sector is a major step to ensuring this happens. However, other factors such as cheap imports must also be recognised for the threat they pose. Some may argue that duty increases weaken and, ultimately, will destroy local manufacturing because it makes the industry less competitive. The data on ‘market forces’ and ‘free trade’ indicate, in theory, that this may be the case, but the facts speak otherwise. Such data-driven arguments are, at best, disingenuous and, at worst, obvious scaremongering. A competitive industry cannot be measured on the cost to consumers alone. The days of measuring a company’s performance only by the bottom line are no longer feasible or desirable. Our cement manufacturing processes are
regulated, from environmental impact assessments to strict quality controls, and from labour and employment regulations to sustainability requirements – South Africa is a signatory of the Paris Accord on CO2 emissions. These processes, however, are not always required with products manufactured elsewhere. Data aside, the fact is that South Africa’s cement manufacturing sector is pivotal to in the future development of South Africa’s economy. Chairman of The Concrete Institute Rob Rein, who is also PPC Group Executive of Sales and Marketing, said cement was a vital industry for the country and needed the government’s support at this critical survival stage in the construction sector. Apart from the number of people employed directly in the mining of limestone and the processing plants, and indirectly through the construction, haulage, energy and building-related sectors, the industry is an essential component of the government’s infrastructure strategy. Local manufacturers currently produce approximately 12.5 million tons of cement a year. They have the capacity to produce an additional five million tons. When the infrastructure programme kicks in, the sector will be pushed to its limits; it needs to grow along with the country if it is to keep pace with development. Major investors recognise this: the Public Investment Corporation (PIC), which invests the assets of the Government Employees Pension Fund, has a substantial stake in Afrisam as well as PPC. Pension funds invariably are invested for long-term gains. Similarly, Dangote has a 64% stake in
Sephaku Cement. These investments run into billions of rand and go a long way to helping create a sustainable and vibrant sector. Tomorrow’s successful companies have made the paradigm shift from a firmcentric view of the world – in which the firm’s purpose is to make money for itself – to a customer-centric view of the world, in which the purpose is to add value for customers. Such a sustainability approach to construction (and development) incorporates a holistic strategy to the nation’s long-term growth. The upshot is that companies must be innovative, agile and flexible if they are to survive. The key to future growth, therefore, lies in achieving greater e ciencies within the country’s relevant manufacturing sectors. Of all the measures of a nation’s development, infrastructure may be the most underestimated term. When really, it is the cement that binds the nation – socially, economically and governmentally.
BRYAN PERRIE Questions? bryanp@theconcreteinstitute.org.za 15
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2019/09/18 11:08