Minister of trade and Industry Dr Rob Davies has approved the recommendation by the International Trade Administration Commission of South Africa (Itac) to increase the rate of customs duty on zinc-coated/galvanised steel, aluminium-zinc-coated steel and colour-coated steel to 10% ad valorem.
The Minister’s approval is based on the recommendation by the Itac following its own extensive investigation which looked at tariff increases. The investigation was initiated after an application from the South African Coil Coaters Association on behalf of ArcelorMittal South Africa Limited (Amsa) and Safal Steel.
According to Tralac researcher Willemien Viljoen, the recommendation comes in the wake of excessive global steel capacity, difficult trading conditions and rising input costs.
The conditions of the recommendation stipulate that there will be no price increases for the steel products in question as a result of this tariff adjustment, says Davies, adding that pre-existing commitments to reduce prices on some products must be honoured.
In addition, Itac will conduct a review of the duty structure to determine its impact on the industry value chain, three years from the date of implementation.
Amsa will invest an additional R250 million in its colour line, while Safal Steel will invest an additional R300 million in its metal coating line in 2017, notes Davies.
Itac will establish a committee comprising the applicants, downstream users, the departments of Trade and Industry and Economic Development and relevant experts.
Minister approves conditional steel tariff increase
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