LOCALISATION OF MANUFACTURING KEY UPLIFT SA

Viren Gosai is General Manager at ARTsolar – an SA Solar PV manufacturer & engineering procurement and construction organisation.

SA Solar PV manufacturer & engineering procurement and construction organisation.As South Africans, we have always been resilient and faced almost insurmountable situations – and we overcame! But today, we face new challenges, and if they remain unresolved they may just result in irreversible consequences – like our declining manufacturing industry!

Globally accepted opinion on the resuscitation of an economy is that the internal manufacturing sector is a crucial contributor.

Sadly, our manufacturing sector is experiencing a major decline; negatively affecting the unemployment rate.

Localisation has the potential to turn this economy around and uplift many South Africans but the policing thereof has to be strict. So what is the current status of localisation? The ideology appears to be thrown around at political exhibitions and is often written into policy within certain state-owned entities and government subsidiaries whose mandate is to stimulate local business; create employment and even export goods.

But it would appear the adverse is actually happening on the ground.

Let’s consider a simple scenario: South Africa has ample sunlight and our renewable energy policies are also world leading. Yet, we are experiencing a power crisis!

If the manufacturing sector reached the levels of times gone by – our national grid would collapse. So, the near death of manufacturing is actually enabling the lights to be on!

Which is why capacity is being increased through renewable energy. So this is a great solution right?

Well, not quite – the source of the products procured is mostly non – South African, and the “local content” is gross profit to satellite companies, transport and some labour – merely to show some job creation.

Seemingly, power will be produced to supplement the grid at a “cheaper” cost and the problem of load shedding will be a thing of the past?

This is an extremely short-sighted solution with a far greater cost to the country. Because South Africans will become totally dependent on foreign products to address a local problem. If that product fails – the ability to correct and restore sustainability moves to that foreign supplier.

Effectively, we are ceding our “power” to a non – South African. Consider “first world” manufacturing failures where production was moved to reduce input costs, then finally the entire product was produced externally.

This resulted in entire cities losing their livelihood. And this loss can never be reversed. As South Africans, we have provided a great story to the world – one of liberation, triumph over adversity, and the world listened. But we are not listening to the world.

How then, do we utilise the global knowledge and experience of these foreign giants?

Simple – we engage in a skills transfer programme. We request that these global giants invest in our country’s manufacturing sector. Practically, projects should be sourced from South African factories, produced under licence for the global giants. Not only does this create sustainable employment and boosts the economy – this also reduces the carbon footprint of the product being supplied. In many instances, our soil houses the raw materials of these products. These are mined, processed, shipped to foreign locations, and then shipped back to our Country as a final product. This phenomenon is not only limited to renewable energy.

So does the government not know this? Can it not devise policies to implement a seemingly simple solution? The government has amazing localisation policies and programmes – but there is seemingly a blatant non-compliance to these rules. Locals are not directly benefiting from localisation.

Therefore, our manufacturing is dying, our people are suffering, and our dependence on global giants is increasing. We write world leading policies – but there is no/little compliance. So we slip further into an economic and social pit.

This needs to stop now! The government needs to act! We want compliance, we want real localisation to benefit our people!

 

Authors Details

Name: Viren Gosai

Position: General Manager at ARTsolar – 100% locally owned, proudly South African manufacturer of solar panels based in Durban, South Africa

Physical Address: Unit No. 11, New Germany Industrial Park, Pinetown, South Africa

Contact Number: +27 31 100 1019

Email Address: info@artsolar.net

Facebook: https://www.facebook.com/artsolar1

Website: https://artsolar.net

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