With the world markets still suffering the after-effects of maladministered and unsustainable macroeconomic policies, there is not much appetite for large capital projects in South Africa. But economic growth will start only once people are investing, which does not happen without a positive outlook, says vessel and piping fabrication business Hydra-Arc engineering manager Ewan Huisamen.
For that to become a reality, he notes that government needs to support the local steel construction industry through embargos and levies on imported goods, as well as incentivising and regulating government procurement contracts. “This will enable the industry to meet an 80% spend on locally manufactured products, thereby improving employment, relieving social grant burdens and undercutting crime.”
Cheap imports from Asia are playing a major role in the steel industry because the local industry cannot directly compete with a government backed and incentivised steel and construction Asian industry. This means that government will need to play a role in incentivising local products and manage existing anti-dumping duties and tariffs.
Carbon steels are being replaced with stainless steel, advancing its popularity and promoting the sustainability of the stainless steel sector.
Huisamen points out that the challenges facing the industry mean that users of steel are demanding longer service lives from equipment, as the replacement of new capital equipment is on the rise.
Training to Compete
Huisamen notes that Hydra-Arc has committed to providing training that is in line with ensuring that manufacturing takes place locally.
“Part of the company’s human resources development is to focus on the training and skill enhancement of welders, pipe fitters and boilermakers.”
He adds that the company’s Mshiniwami artisan academy, in Secunda, is training 450 learner welders and 450 pipe fitters, as well as 50 boilermakers yearly.
According to Huisamen, 96% of the academy’s graduates are currently employed in their trade, with the remainder of the graduates in supervisory positions. Hydra-Arc has also created about 1 500 new jobs in the past three years.
“We aim to use as many trainees at our projects as possible. The water tanks that we are producing for local government are almost exclusively built by trainees from our school,” says Huisamen.
Upon installation of the tanks in the designated areas, the company employs only members of the local community for the civil works, such as the fencing and trenching, which translates into skills transfer and development in these communities.
He explains that growth can be spurred on only by foreign capital investment, which requires a reignition of the mining industry and that State-owned power utility Eskom signs the power purchase agreements for the new independent power producer projects.
The industry should invest in human capital development to ensure that adequately skilled resources are available to meet likely future demand.
“Our business has always depended on the skill of our people and our willingness to embrace new technologies in welding and steel fabrication. This ensures that we constantly focus on training and skills development, as well as the testing, practical application and development of new technologies,” states Huisamen.
He concludes that putting a timeline on goals is difficult, but that the company believes that it is getting closer to becoming a global leader in the steel construction and fabrication industries, while ensuring sustainability and the inclusion of all its people and, therefore, its success.