NERSA Public Hearings on RCA Application SEIFSA. 4 February 2016

Transcription

1 PRESENTED BY: Henk Langenhoven & Taffie Chibanguza EC Department NERSA Public Hearings on RCA Application SEIFSA 4 February 2016

2 THE STEEL AND ENGINEERING INDUSTRIES FEDERATION OF SOUTHERN AFRICA SEIFSA is a National Federation representing 25 independent employer Associations in the metal and engineering industries, with a combined membership of companies employing about employees. The Federation was formed in 1943 and companies in Associations federated to it range from giant steel-making corporations to microenterprises employing fewer than 50 people.

3 DISCLAIMER The views expressed in this presentation do not necessarily represent those of SEIFSA Associations and/or their membercompanies

4 CENTRAL MESSAGE: THE SECTOR IS IN DIRE STRAITS AND ANY INCREASE IN ELECTRICITY PRICES WILL CAUSE FURTHER CONTRACTION BACKGROUND THE STATE OF THE METALS & ENGIEERING SECTOR INTERDEPENCECY AMONGST MINING, AUTOMOTIVE CONSTRUCTION & EXPORTS THE SPECTRE OF STEEP ELECTRICITY PRICE INCREASES

5 Components of the Metals & Engineering Sector Sub Sectors Steel & Eng % % Rubber products Plastic products Basic iron and steel products Non-ferrous metal products Structural metal products Other fabricated metal produ General purpose machinery Special purpose machinery Household appliances Motor veh/trailers Electrical Mach & Equip Parts/accessories Total

6 M&E Sector: Vital Statistics Real output Output price Nominal Output Real value added Real gross domestic fixed investment Real fixed capital stock Em ployment: Form al Em ployment: Formal & inform al Rm 2010-prices Index 2010=100 Rm 2010-prices Rm 2010-prices Rm 2010-prices Num ber Num ber Year , ,304 76,152 9,579 86, , , , ,216 78,017 10,809 87, , , , ,853 85,568 10,587 87, , , , ,808 84,085 10,522 87, , , , ,529 89,014 10,692 87, , , , ,522 94,157 11,038 87, , , , , ,205 12,373 88, , , , , ,950 13,937 90, , , , , ,235 15,599 92, , , , ,293 89,852 10,553 90, , , * 382, ,716 92,722 11,055 89, , , , ,145 95,976 12,509 89, , , , ,982 96,051 14,874 90, , , , ,582 98,433 13,514 90, , , , ,253 96,439 11,286 87, , , ** 390, ,424 94,416 9,531 85, , ,150

7 Electricity Intensity: Vital Statistics

8 CENTRAL MESSAGE: THE SECTOR IS IN DIRE STRAITS AND ANY INCREASE IN ELECTRICITY PRICES WILL CAUSE FURTHER CONTRACTION BACKGROUND THE STATE OF THE METALS & ENGIEERING SECTOR INTERDEPENCECY AMONGST MINING, AUTOMOTIVE CONSTRUCTION & EXPORTS THE SPECTRE OF STEEP ELECTRICITY PRICE INCREASES

9

10 Metals & Engineering Production

11 Quarterly Growth Patterns in M & E

12 Below optimum CAPACITY Utilization

13 Capacity Utilization

14 Metals & Engineering Net Surplus Trends

15 Net Surpluses & Fixed Investment within the Sector

16

17

18 CENTRAL MESSAGE: THE SECTOR IS IN DIRE STRAITS AND ANY INCREASE IN ELECTRICITY PRICES WILL CAUSE FURTHER CONTRACTION BACKGROUND THE STATE OF THE METALS & ENGIEERING SECTOR INTERDEPENCECY AMONGST MINING, AUTOMOTIVE CONSTRUCTION & EXPORTS THE SPECTRE OF STEEP ELECTRICITY PRICE INCREASES

19 Sectoral Interdependence R620 bill VA = 17% of GDP Total Impact X 1,5 to 4 times to GDP 80% of Foreign Exchange Employ 1,7 million

20 Mining Production since 2000 (2010 = 100)

21 Auto Sector Performance

22 Investment Growth Performance of the Economy

23 Investment Growth Performance of the Economy

24

25 Commodity Prices: World Bank Forecast

26 CENTRAL MESSAGE: THE SECTOR IS IN DIRE STRAITS AND ANY INCREASE IN ELECTRICITY PRICES WILL CAUSE FURTHER CONTRACTION BACKGROUND THE STATE OF THE METALS & ENGIEERING SECTOR INTERDEPENCECY AMONGST MINING, AUTOMOTIVE CONSTRUCTION & EXPORTS THE SPECTRE OF STEEP ELECTRICITY PRICE INCREASES

27 Electricity Costs/Share of Input Costs

28 SARB Outlook for Electricity Prices

29 SARB Electricity Price Scenario

30 Electricity Price Inflation & Intermediary PPI

31 Electricity Price Inflation Under/Above Intermediary PPI

32 PRESENTED BY: Henk Langenhoven & Taffie Chibanguza EC Department Web: Tel: 0861 SEIFSA CENTRAL MESSAGE: THE SECTOR IS IN DIRE STRAITS AND ANY INCREASE IN ELECTRICITY PRICES WILL CAUSE FURTHER CONTRACTION THANK YOU Henk Langenhoven