The Competition Commission prescribes the following principles in respect of the collection and sharing of information about the industry For information sharing to the acceptable in the manner proposed, the following broad principles need to be considered: • The sharing of information must be facilitated by an independent third party, and this can be funded from the levy. This will allow for information to be aggregated and shared with industry in real time, without the risk of collusion. • It is important to ensure that competitively sensitive information such as prices, customer lists, production costs, quantities, turnovers, sales, capacities, marketing plans, risks, investments and technologies is not shared between competitors, unless under very strict conditions. • Depending on the structure of a market, the information can be shared in aggregated format and within specified timeframes for different type of information (e.g. historical data, current strategies or future plans). However, the steel sector is highly concentrated, which makes it susceptible to collusion. • Government policymakers usually require information, which may include competitively sensitive information, from market participants in order to formulate policy. In other circumstances, government regulators require information to allow them to regulate industries. It is perfectly legitimate from a competition perspective, for policymakers and regulators to collect and process information from market participants and for firms to provide the relevant information. Transformation has not made adequate progress. It is necessary to distinguish between hands-off investment and hands-on ownership and participation. A number of black industrialists have emerged in the steel and metal fabrication sectors, in part as a result of government policies and funding. Like the rest of the industry, many are struggling. Some investments have been in businesses which are weak or failing and have little prospect of turning around in a shrinking industry with low demand. Supporting investment of new players in failing enterprises in a shrinking market can set people up to fail. The IDC is becoming much stricter about the need for investors to put in some of their own capital before it invests. The industry should work with the IDC and the dtic to formulate sustainable and effective transformation strategies linked to effective local content policies, addressing amongst other things the development of skills, representivity of senior management and technical experts, and supplier development. Embedding new and SMME businesses in the supply chains of large businesses is usually the most effective way of developing the new or small businesses, rather than expecting them to “go it alone”, especially in the export market, where they are unlikely to even gain access to project procurement. 12.2 Worker involvement models at company level must be explored further and given more prominence as an option for transformation. Options should include both share ownership and participation in strategic decisions on productivity, optimization, skills and training and other relevant matters. These should count towards transformation and localization targets. The unions have stated that they are open to discussing these options. 12. TRANSFORMATION 12.1
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The South African Steel and Metal Fabrication Master Plan 1.0
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