The Steel and Engineering Industries Federation of Southern Africa (SEIFSA), Manufacturing Circle and the Powerline and Substation Association (POLASA) have noted with concern recent public comments attributed to the Director-General of the National Treasury suggesting that manufacturing is unlikely to be the primary source of future employment growth in South Africa.
While we acknowledge that the structure of modern economies is evolving and that sectors such as services, tourism and construction have an important role to play in driving economic growth and employment, this comment nevertheless raises important questions regarding the coherence and consistency of South Africa’s economic policy direction.
Manufacturing has, for many years, been identified by government as a strategic pillar of South Africa’s industrial development agenda. It remains central to the country’s productive capacity, export competitiveness, technological advancement and long-term economic resilience. As one of the most industrialised economies on the African continent, South Africa cannot afford ambiguity regarding the future role of its manufacturing base.
Our concern is therefore not centred on whether other sectors should grow; they absolutely should, but rather on the policy signal that comments of this nature send to investors, manufacturers and businesses making long-term investment decisions.
Economic policy is shaped not only through legislation and budgets, but also through the signals communicated by senior public officials. Institutions such as the National Treasury occupy a uniquely influential position in shaping expectations regarding future policy priorities, investment incentives and fiscal support. For this reason, consistency in public messaging across government institutions is essential.
It is equally important to recognise that South Africa’s manufacturing challenges cannot simply be attributed to global structural changes or declining labour intensity. The sector has faced more than a decade of escalating electricity costs, logistics failures, infrastructure constraints, municipal decline and prolonged policy uncertainty. These factors have materially constrained investment, competitiveness and employment growth.
Public procurement reform, infrastructure investment and industrial competitiveness remain among the most powerful levers available to government to stimulate domestic manufacturing demand and improve capacity utilisation. These are the areas in which coherent policy implementation remains critically important.
The manufacturing sector does not seek preferential treatment above other sectors of the economy. Rather, it seeks a stable, predictable and consistent policy environment that reinforces government’s stated commitment to industrialisation, investment and economic growth.
It is therefore vitally important that National Treasury provides clarity on how these comments align with government’s broader industrial policy objectives and long-standing commitment to growing South Africa’s manufacturing capability.
At a time when countries around the world are strengthening their manufacturing sectors through industrial policy and strategic investment, South Africa must ensure that its own policy signals inspire confidence rather than uncertainty.
SEIFSA, the Manufacturing Circle and POLASA remain committed to working constructively with government and all social partners to advance policies that strengthen South Africa’s industrial base, create sustainable employment and improve the country’s long-term economic competitiveness.
Issued by SEIFSA, Manufacturing Circle and POLASA
