Business: Inst. Of Steel Construction Collaborates with U.N. Body
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This initiative is part of the UNIDO Subcontracting and Partnership Exchange (SPX) programme, which is a technical cooperation programme that links domestic enterprises in developing countries to the supply chains of large domestic or international companies. The fundamental aim of the UNIDO SPX programme is to help develop local SME capacity to meet buyer needs and to identify profitable business and or investment opportunities for them.
De Clercq says that a world class and continuously improving local steel construction industry will play an important role in the future development of South Africa and that the Institute is doing all it can to ensure this. He added that it’s not only the local steel construction industry that should be keeping up with world standards, but all local industry.
“While it’s true that there have been countries - like Switzerland and Hong Kong for example - who have excelled on non broad-based manufacturing economies, it is beyond doubt that large developing countries require a strong, competitive industrial manufacturing base in order to stimulate the participation of the masses in the economy,” he says.
De Clercq says that while making exceptionally high-tech products like Swiss watches or Japanese cameras can obviously be very stimulating for an economy, only a relative few are involved in the production cycle. “It is logical for a developing country to excel first in industries which require a lower level of technology and enable a wider range of development and involvement than to concentrate on producing esoteric widgets, which may be attractive to a small group of people on foreign shores, but have a limited local multiplier effect.”
He adds that this broad manufacturing base must also be sustainable. “One of the underlying problems of the U.S. economy has been the minimisation of its fundamental ability to produce. It lost its competitiveness in an increasingly globalist economy. “
“From a South African perspective, we need to realise the importance of building a competitive, sustainable manufacturing base where we can make a plethora of ‘our own things’. But we need to learn from the American experience by not only capitalising on the inherent strengths – and there are many – of every South African sector to become globally competitive but we must also ensure that we remain so in the long term.”
De Clercq added that an important result of the collaboration with UNIDO will be the helping of buyers – especially those in state-owned enterprises - through a profiling exercise in which the capabilities and characteristics of companies in the industry will be captured in a specially designed data base, to procure the services of the local industry.
He says that although, in contrast with Australia and many other countries, the impact of foreign steelwork contractors has been small in South Africa, it is crucial to constantly promote the local industry for local projects. “In South Africa most cases where foreigners have been successful are where entire projects, of which the structural steelwork is only a small portion, have been awarded to foreign companies.”
“An example of this is the new cement factory for Sephaku Holdings, planned to start next month, for which more than 1000 Chinese workers, including some doing menial work, will be imported. Significant portions could have been performed as well, cheaper and with a lower level of risk by South African companies and people.”
De Clercq says that growing a sustainable industry is not only about the local scenario but also developing the ability to export. “This requires an effort from every industry. We have to seek out customers and partnerships across the globe and actively market our attributes to them. This is precisely what SAISC is doing through the International Steel Fabricators (ISF), the Institute’s export arm, which continuously promotes the South African steel construction industry abroad.
ISF director Neels van Niekerk travels extensively in accomplishing this. “Meeting people face to face is essential,” says van Niekerk. “To expect to win contracts overseas by merely sending marketing collateral or a tender document is to miss the most important factors in the export business – personal contact and trusting relationships.”
De Clercq says that clearly every industry that wants to grow should aspire to increasing its exports but that it makes more sense to export a product or service that has proven to be a success in one’s local market. “This has certainly been true for the steel construction industry. We have been around for more than 100 years and in this time we have developed locally what it takes to be globally competitive. And the proof of the pudding is that in the last four years there has been a 100% growth in the level of steel construction exports.”
De Clercq says that the steel construction industry has become a model of a sustainable and productive industry so vital in a developing economy. “Sure, we do not offer a very high-tech product but ours lends itself to a high level of expertise and differentiation and, importantly, we have become good at it. In fact we believe we are out there with the best in the world.”
Over the past three years the steel construction industry has invested heavily not only in building capacity but becoming better, more sophisticated and more highly skilled. “Our industry is now characterised by some of the most exciting steel construction companies in the world and the SAISC has become a dedicated supporter of these companies, and the industry at large, engaging itself in, inter alia, training and skills development, research and importing the best practices from the world over.
The combination of the abilities of the industry and the facilitating role of the Institute has ensured the growth of the industry and, crucially the excellent name and ‘brand’ of the local steel construction industry thus ensuring, amongst a host of other things, that major projects such as the new power stations are and will be built by South African companies using South African steel.
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