Pietermaritzburg scrap dealers say the ban on the trade in scrap copper and ferrous metal for six months will cripple their businesses.
The ban was announced by the Department of Trade, Industry and Competition (Dtic) on Wednesday and has been welcomed by the Department of Co-operative Governance and Traditional Affairs (Cogta).
The government said the ban was part of measures to address the theft of public infrastructure for resale as scrap metal that causes more than R47 billion in damage annually to the economy.
The ban is part of phase one and more measures will be introduced in the next phases, which will include prohibiting the use of cash in copper and scrap metal transactions, following legislative amendments and limiting exports to a defined number of ports of exit.
These measures were considered and approved by Cabinet on November 16. Scrap dealers said it was not fair to blame them for the theft and that the government should increase the security of its infrastructure.
“I don’t think I will be able to continue working after this. They are putting a burden on us and I don’t know how they expect us to survive. The findings also take advantage of the situation because they know we don’t have any other place to sell,” said one of the scrap dealers, who asked not to be named.
Another scrap dealer said they were also concerned about the theft of government infrastructure. “In as much as we are all painted with the same brush, some of us do not accept dodgy materials because we know they could be coming from the municipal infrastructure, which also affects us directly …” he said.
‘Impossible to police all of this infrastructure’
Dtic minister Ebrahim Patel said SA has an extensive network of electricity and Telkom cables, rail tracks and rail cables, and municipal infrastructure such as traffic lights and drain covers.
“It is practically impossible to police all of this infrastructure all of the time. The measures approved by Cabinet therefore seeks to reduce the demand for scrap metal from the lucrative global market, while simultaneously disrupting criminals’ transport and logistics networks,” he said.
After the temporary ban, a permit system that will be administered by the International Trade and Administration Commission (Itac) will apply to semi-finished copper exports then import controls through a permit system will be instituted for furnaces and other scrap transformation machinery.
In phase two, the government will introduce measures requiring buyers and sellers of scrap metal to show that they are tax compliant and have all the necessary environmental permits in place before being issued with buyers’ or sellers’ licences.
These companies will also have to show where the scrap metal originated from and to whom it was sold. Phase three will consider making amendments to pertinent existing legislation, or pass new legislation, to create a dedicated metal-trading licensing regime.
MEC for Cogta, Sihle Zikalala, said the ban will stop criminal groups from destroying municipal infrastructure in the province, which has cost hundreds of millions of rand and hurt the economy.
“As a department, we continue to collaborate closely with the sphere of local government to ensure that the necessary safeguards are in place to protect the public infrastructure that is used by so many people on a daily basis,” he said.
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