Rev. Dr. George Dawson-Ahmoah
The Steel Manufacturers Association of Ghana (SMAG) says the recent increase in electricity tariff, coupled with high cost of importation of steel, is killing the local steel industry.
Members of the association yesterday were at Parliament House to meet joint Parliament committees on energy, trade and industry after they had earlier petitioned the Speaker of Parliament over the recent increase in electricity tariff.
The Executive Secretary/Consultant of the Association, Rev. Dr. George Dawson-Ahmoah, after the meeting told journalists that the steel industry was strategic for economic development and must not be forced out of business.
He said the tariff challenges were causing unrest in the industry, adding “currently, electricity tariff is hovering around 92% for the steel industry.”
“We are saddened by the fact that the
number of steel manufacturing companies in Ghana was eight but two of them have
recently collapsed because of these unfavourable business conditions,” he
disclosed. “It is worthy to note that the local steel industry employs about
3,000 direct workers and 10,000 indirect workers. The companies also contribute
significantly towards government revenue in the form of taxes,” he added.
Rev. Dr. George Dawson-Ahmoah, who doubles as the Executive Secretary of the
Chamber of Cement Manufacturers, stressed that the steel industry also uses
local content by providing job for over 10,000 scrap dealers, and it is
expected to consume about 1.2 million tonnes of scrap for production annually.
“The installed capacity of the local steel industry is about 1,200,000 metric tonnes per annum against an annual average demand of about 350,000 metric tonnes per annum which results in a surplus of 850,000 metric tonnes per annum. How can we kill such an industry by encouraging importation of finished steel products when it has such a huge surplus capacity?” he queried.
“Our checks have it that some of our neighbouring countries pay as low as 0.9 cent per Kw/h of electricity so until the enquiry is concluded we are requesting that the old tariff of GH¢0.41 pesewas must be maintained as an interim tariff,” he pointed out.
On the issue of the illegal importation of steel products into the country, the association appealed to the government for a legislative instrument (LI) which would introduce quotas that would regulate the importation and also introduce/impose certain levies as safeguard measures on importation to protect the local steel industry.
Members of SMAG are Sentuo Steel Company Limited, Tema Steel Company Limited, United Steel Company, Rider Steel Limited, Ferro Fabrik Limited and Fabrimetal Ghana Limited.