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SACEEC was established in the late 1990s as a mining cluster. We have grown significantly and today we have over 160 members who are exporting worldwide and have become part of the capital equipment, machinery and equipment export council. Our market has changed from exclusively focusing on mining to include other industries. As an export council we focus on opportunities abroad.
I am proud to say that when the pandemic hit, SACEEC was one of the first councils to offer a very interactive webpage. Within two months, we were able to put our members in front of all their clients on a virtual platform that is still running today. In addition, most of our members have met their targets due to supplying the local as well as the export market. We also promote establishing a footprint within any country of operation to service the aftersales market, and this has made it possible for our members’ businesses to continue.
South African equipment and machinery are perceived exceptionally well globally, especially in the mining industry. The machines are robust and can operate in extreme environments. Many of our members formed partnerships with European companies, as they need the technology being developed in these countries. The robustness of the machines we manufacture has been proven, and we are finding, especially looking at the Latin American market, that people are prepared to spend more to get reliability. We are not a mass-production market and are very niche – everything is specialized and tailored towards customer needs. We find that customers prefer this niche market as they want the reliability, quality, and after-sales service we can offer.
To be honest, the South African companies do not receive sufficient support from the government regarding financing options. South African companies either finance themselves or rely on the help of an international partner. The moral support from the government is there as they want to promote exports, but financial support is lacking. Access to capital is an issue in South Africa, especially when you need pre-shipment finance, and it is delaying growth. However, the Department of Trade and Competition is promoting South African exports.
When competing internationally, we compete with companies in countries with banks lending money at a low interest. Another challenge in South Africa is the steel prices and supply, as steel is an essential raw material. We hope that the high metals prices will boost the South African economy in the near term and have a positive domino effect on manufacturers.
South Africa was in a recession before Covid-19, exacerbated by the outbreak as another 4 million people lost their jobs over the past 18 months. We are struggling financially, but the industry perseveres, and it will continue due to our companies’ robustness and survival attitude. The pandemic has given companies a chance to re-evaluate and realize that business can continue and be successful if done differently.
The South African mining industry is not growing at the rate that it should be, and there is a lack of new expansions and developments of greenfield projects. The industry is suffering, and there has not been enough investment due to aspects such as the mining charter and BBEE regulations. As a result, mines and production are slowing down significantly. Looking at Namibia, Botswana, Zambia, the DRC, Ghana, and several other African countries, the mining industries are still growing, which poses opportunities. We are successful in Africa, Australia, South America, and Canada. We are also focused on the Russian markets as they are also expanding and are good markets to be in at the moment.
We will continue to focus on getting our members in front of their customers during these challenging times. We will be present at the DRC Mining Week in 2021 and will be hosting our first local manufacturing expo in South Africa in November. We will also be running our exporter of the year award, and it will be exciting to see what our members have achieved even during a pandemic. SACEEC will keep its focus on promoting its members globally, even if it has to happen virtually.