FIFI PETERS: We are following up on the tyre story that we reported on, on Tuesday, I feel it was. What has occurred since then is that we had the native importers on the present telling us why they had been towards the safety that the producers had been looking for from imports out of China. If you missed the present on the day you’ll keep in mind that the native importers argued that the imports, if put in place, might improve the worth of tyres by 17% to 41%, relying on the automobile that you simply drive – a truck, a bus, a taxi and the like.
Now to listen to the different facet of the story, I’m joined by the South African tyre producers themselves, the South African Tyre Manufacturers Conference, SATMC. They signify the likes of Goodyear, Continental, Sumitomo, in addition to Bridgestone. We’ve Nduduzo Chala, the managing government of the SATMC. Sir, thanks a lot to your time. The importers that we spoke to there are towards this transfer; why then as producers are you in favour of import duties from China?
NDUDUZO CHALA: Good night, Fifi and to the listeners. I feel we firstly have to have a look at native manufacturing from a way of contributing to the trade or, let me say the economic system of South Africa firstly. I feel that’s the first motive why we must have that high of thoughts.
And actually I feel the purpose of placing an software for an investigation into obligation is to equalise issues and to normalise the taking part in discipline as a result of we consider that we have been unfairly [prejudiced] in the earlier years of merchandise which have been coming from China.
I feel from an importer’s perspective they’d have benefited all these years [to] the detriment of our native producers, and in case you contemplate the magnitude of what number of staff and jobs that we must retain the sustainability of additionally manufacturing in the nation. So I feel it’s a matter which could be very, very delicate and [one in] which we want to have a look at the larger image versus simply the one-sided view, and in addition unfounded statements which have been made presently.
FIFI PETERS: Except their depiction of what the larger image seems like is kind of complicated, as a result of they’re saying that you simply as producers already import a complete lot from China, and subsequently they’re fairly confused as to why in impact you’d be wanting duties positioned on yourselves as producers. So are you able to dispel that notion? As the native trade, how a lot do you import from China presently?
NDUDUZO CHALA: Again, I feel it goes again to saying that we have to be very cautious of, let’s say, a few of the statistics which have been shared, that are unfounded, as a result of we are the producers. Firstly, I feel there isn’t a firm that can put [down] a producing base with out it ensuring that they’ll utilise the capability, as a result of that comes with the capital funding.
So for all 4 of our producers who make use of greater than 6 000 folks direct, [so] additionally direct employment. And in case you contemplate the worth chain, which is also linked to them, greater than 90 oblique jobs additionally.
And in the final three years, which had been Covid-particular years, you’re looking at a contribution to the SA economic system of R16.9 billion, in order that they [have] no based statements of what they assume. So if we contemplate the quantity [in] 2021 of tyres bought in South Africa, 70% of these had been regionally manufactured tyres. So that’s why I’m saying we have to be very cautious of how [we] have a look at the statistics that are being shared, as a result of we have information which is verified and 70% of their very own gross sales final yr had been regionally manufactured merchandise.
FIFI PETERS: All proper. I’m simply making an attempt to get a few of their numbers right here, as a result of basically considered one of the arguments that they made is that 3 200 tyre merchandise or so right here which might be made regionally, and of that 80% of the inputs are imported. I’d like to grasp in case you are saying that that determine is incorrect. Okay, wait, I’ve received the assertion that they make right here. They say that, given that nearly 3 200 tyre merchandise bought in South Africa, [that] as candidates – you as candidates, as the producers – import 80% of the number of tyres that you simply promote. So are you saying that that isn’t true?
NDUDUZO CHALA: That is unfounded. I hear nothing of it the benefit of why you’d need a manufacturing facility in a rustic. I don’t assume you’d put up a producing base solely to import, as a result of all of the labour, all of the working prices [of] the corporations and the uncooked supplies that we buy – then it doesn’t make any logical [reason], any sense for us to be doing that.
But once more, I feel the focus right here will not be essential to say the SATMC nor its members are eager to hike costs. What we are basically saying is that we need an equalisation of [the] taking part in discipline, so tyres that are manufactured regionally are actually aggressive. So the costs [at] which they land their merchandise right here in South Africa make us uncompetitive, and that’s the reason we submitted the software to Itac [International Trade Administration Commission], who’s the unbiased authorities physique presently investigating the state of affairs.
We as the SATMC and its members have full religion in Itac in that they’ll do the due diligence by way of the investigation. We are ready for a preliminary willpower most likely in the coming weeks or months, which will likely be shared by Itac by way of what they’ve discovered, as a result of we have submitted info as a part of this software and the importers as properly will permit them a possibility to additionally submit their very own info in order that Itac can have a view of each side after which make the willpower.
So I feel we have saved them the course of and that’s why we need Itac to hold out the investigation. And whether it is true, let’s say in the favour of the SATMC, then I feel South Africa will begin to then additionally perceive to say that these are native producers who’re dedicated to the nation, who’re dedicated to the economic system of the nation as a result of, in case you contemplate the livelihoods that profit out of the employment of the tyre trade, it’s our personal South African folks. And the beneficiation, which has been a significant downside in lots of different sectors of trade …
FIFI PETERS: Nduduzo, sorry, I’m going to interject there. I’m going to interject there. You say the worth of the tyre that lands right here from China in comparison with the worth that you simply promote [at] could be very completely different. Can you give us the common worth of a tyre? You can examine apples and apples right here by way of whether or not we are speaking a few tyre for a bus or a tyre for a truck, a taxi, or the like, that’s made regionally, and the worth that comes from China.
NDUDUZO CHALA: Again, I feel let’s go away that course of to Itac, as a result of I feel it’s then going to be a state of affairs of ‘they said, we said’. As a South African tyre producer, Itac I feel is finest positioned as the unbiased physique to then give us the willpower to say: do additionally they see or consider that there was undue pricing of tyres touchdown in South Africa versus what we have as the native producers?
FIFI PETERS: Just lastly, then, what do you make of their declare? The importers’ declare that if these duties do go forward, you guys, as native producers, are going to extend your costs by an arm and a leg, that they’re placing costs up round 41% doubtlessly in case you guys get this safety. So what’s going to occur to costs?
NDUDUZO CHALA: From a South African perspective or the native producers, for us there’s no motive why. Again, it’s sensationalism to say that we will improve costs. What we are basically saying is that merchandise that come into the nation from China are making us uncompetitive, so there’s no motive why the native producers are going to extend costs. Maybe we must flip the desk to say the importers are going to extend their pricing. We are looking for right here to say we need the equalisation of the taking part in discipline, the unfair commerce, and we have Itac investigating that for us as the native tyre producers.
FIFI PETERS: Yes, I suppose that we are all keenly then ready for the Itac report when it drops. So you say what – the finish of August or in the subsequent couple of weeks?
NDUDUZO CHALA: In the subsequent couple of weeks. So we appear to consider that it’ll be in the month of August.
FIFI PETERS: All proper. Okay. Thanks a lot, Nduduzo Chala, for sharing the facet of the producers’ story. We do have each now. I suppose the jury does lie with Itac now, and what they’ll do – whether or not they’ll defend or not.
