The Hammarsdale Cato Ridge Development Association has described Assmang Manganese Cato Ridge Ltd as a long-standing investor and exporter, and that its imminent closure will be detrimental to the employees.

More than 600 workers of Assmang Manganese in Cato Ridge outside Pietermaritzburg would be left unemployed as the company is in the process of shutting down.

The company processes manganese and is a joint venture between Assore, whose chairperson is billionaire Desmond Sacco, and billionaire business magnate Patrice Motsepe’s African Rainbow Minerals, which was formed in 1935.

The workers, most of whom live in Cato Ridge and KwaXimba in the outer west region of eThekwini, have been served with retrenchment letters.

Assmang senior communication and branding manager, Betty Maloka, said the company had been facing an unsustainable increase of operational costs of up to 930% since 2008, which became uncontrollable.

“A closure of the plant would potentially affect approximately 310 permanent and 290 contract workers. Assmang is committed to ongoing engagement with affected employees and community leaders and is working closely with relevant stakeholders and authorities to explore ways to minimise the social and economic impact of potential closure.

“Despite extensive efforts to sustain operations, the plant has been unable to overcome the mounting financial losses caused by depressed global manganese alloy prices and rising production costs,” said Maloka.

John White, CEO of Hammarsdale Cato Ridge Development Association, said the announcement of the closure did not happen ‘overnight’ and the facility has been operating at consistently reducing capacity for several years.

White said it will undeniably be negative for the workers who will lose their jobs.

"Many Assmang employees have in-demand technical skills which are highly sought after so we are hopeful that many should soon find alternative employment. Positively, Assmang has a large land holding in the area that it is looking to develop.

"It received Environmental Impact Assessment approval last year for 360 hectares of development. This is a significant parcel of land – nearly 2km by 2km. It is prime flat land, has power available directly from Eskom and the N3 is close by," White said.

He was hopeful that Assmang would soon make announcements in this regard, adding that it was very likely that development there would soon create many more jobs than had been lost.

"As an example, the nearby 150-hectare Keystone Park in Hammarsdale, which is about 70% developed, directly provides permanent jobs for over 3 000 people. Development of Assmang land could create over 10 000 permanent jobs – not overnight, but as the development rolls out over a decade or two. This development would unlikely be possible if Assmang was to continue operating, given it is a large, old industrial complex in the centre of the land that will be developed," White said.

He stated that it was, however, not surprising that a firm that relies so heavily on state utilities – power, rail, and ports - was struggling and has been forced to close.

"Eskom and Transnet are regularly rated among the worst-performing utilities in the world. Business simply cannot thrive or sometimes even survive under these conditions. As a progressive business association counting over 80 companies and representing over 11 500 jobs in the outer west, we work tirelessly to make the region a better place to invest, work, and live.

“We do, however, really need to see more effort and better results from the government in some fundamental areas such as rail, roads, ports water, power, and safety, which hold businesses and residents back," White said.

zainul.dawood@inl.co.za