The introduction of a chrome export tax, announced by Cabinet on 21 October 2020, will bring immediate benefits to the ferrochrome industry, and also presents an opportunity for South Africa to support the development of the downstream industry. In the context of a post-COVID-19 recovery plan, industrial development is a priority and requires the use of a multiplicity of measures by the state to strengthen its industrial base.
The implementation of the export tax will mean South Africa is able to take advantage of its natural resources by giving South African ferrochrome producers a price advantage over Chinese firms. Further, it will see the benefits of mining being utilised in support of beneficiation and potentially further downstream. This policy brief discusses the benefits of a chrome export tax, why it makes sense for South Africa as a measure to support the ferrochrome industry, and that this measure alone is not sufficient to grow the stainless steel and downstream industry – an additional set of industrial policy measures are also required.
Media release: 27 October 2020