ArcelorMittal South Africa
By Thobeka Makume
The South African government has rolled out a R1.8 billion support package for ArcelorMittal South Africa (AMSA) to stop the closure of its longs steel plant in Newcastle and prevent thousands of job losses. Announced by the Department of Trade, Industry and Competition (DTIC) on 19 March 2025, this move aims to keep the steel industry alive and protect the livelihoods of nearly 3,000 workers.
Details of the Financial Lifeline
The government’s support comes in multiple forms. In February 2025, the DTIC and the Industrial Development Corporation (IDC) injected R380 million into AMSA. This follows a R1 billion working capital facility provided by the IDC in June 2024. On top of that, the Temporary Employee/Employer Relief Scheme (TERS) has approved nearly R417 million to support 2,982 employees for the next 12 months. Together, these funds make up a R1.8 billion lifeline to keep the Newcastle plant running and save jobs.
Conditions for Support
There’s a catch to this help—AMSA must join the Productivity SA turnaround and recovery programme. This step is meant to boost the company’s performance and make it more competitive. The government isn’t just handing over cash; it’s pushing for long-term improvements to ensure the steel industry stays strong.
A Bigger Plan for Steel
This isn’t only about saving AMSA. It’s part of a larger mission to protect South Africa’s steel industry and its role in the economy. Steel is a backbone for big sectors like mining, construction, and car manufacturing. Yamkela Fanisi, Ministerial Spokesperson for the DTIC, explained: “The South African government continues to engage with ArcelorMittal South Africa to prevent the planned wind-down of the longs steel plant in Newcastle and to recalibrate the steel industry’s role in the South African economy. These interventions are not designed to provide direct financial relief to AMSA but are part of a broader strategy to protect South Africa’s steel industry and ensure the preservation of its industrial capacity.”
Teamwork to Tackle Challenges
A technical working group is also hard at work. It brings together heavy hitters like the Presidency, the DTIC, the Departments of Employment and Labour, Electricity and Energy, Transport, National Treasury, the IDC, the South African Revenue Service, Eskom, Transnet, and AMSA. Their job? To sort out policy issues dragging the steel industry down, from high energy costs to logistics woes.
Why This Matters
AMSA’s troubles started making headlines in January 2025 when it warned of shutting down its long steel operations. The company blamed cheap imports flooding the market, a sluggish economy, sky-high energy and transport costs, and not enough government help. Closing the Newcastle plant could axe up to 3,500 jobs and ripple through industries that rely on steel. That’s why the government stepped in fast.
Recent reports suggest AMSA is pushing for an even bigger rescue package—over R3 billion—to secure its future. Talks are ongoing, and the Department of Employment and Labour is exploring extra ways to support workers at risk, beyond the TERS funding.
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