Thousands of kilometres of cables are dug up out of the ground, ripped out of street light poles and railway lines, pulled down from overhead lines, every day across South Africa, feeding into a flourishing and illegal market for scrap metal.
Individually, each incident involves perhaps a few metres of cable, negligible amounts, but taken together there is a devastating economic impact on the ability of businesses to keep operating and to retain employment.
These cables are the vital connectors of railway lines, electricity substations, street lights and traffic lights, and pump stations to deliver clean water and carry away sewage.
It has reached the point where Transnet posts a daily update on its website of the number of incidents and the length of cable stolen. The most recent was 1.8 kilometres of cable stolen in 13 incidents across Transnet Freight Rail’s key cargo corridors, just in the 24 hours from 26 to 27 September.
The economic costs far outweigh the actual value of the stolen materials.
Consider that the value of the illicit copper “economy” is estimated by the Copper Development Association of Africa to be around R8 billion annually, while research commissioned last year by the government to Genesis Analytics estimates that cable theft costs the economy R47 billion a year.
That figure only considers the economic costs to Eskom, Prasa, Transnet and the mining industry, of disrupted electricity supply, reduced mining output and inability to deliver rail cargo and passenger services, inhibiting production, service delivery, and revenue.
The impact on the wider economy is far greater.
The Bay’s industrial areas, for example, have experienced over 46 unscheduled power outages in the year to date, some of which is caused by vandalism and cable theft. The resulting production stoppage at one manufacturing facility has a ripple effect through their entire supply chain — impacting on deliveries of parts to the next link in the chain, delaying production and timely delivery of export orders, potentially losing future export business, affecting employees’ income due to short-time and layoffs.
The worst-case scenario of business closures and job losses is already happening around us.
Local businesses have adopted 20 substations in various areas of the metro, voluntarily funding armed guards, patrols and monitored cameras, to secure uninterrupted electricity supply — which also benefits other surrounding businesses and communities served by the particular substation.
The initiative is working — not a single incident of vandalism or theft has occurred at these adopted substations, but it comes at an increased cost of doing business. It is unfortunate that business has to resort to providing this level of security at its own cost, but we see it against the greater cost of lost production and lost jobs.
At the level of public services that citizens have a right to expect, cable theft is one of the reasons that there is no street lighting on many of our metro’s freeways and major thoroughfares; that traffic lights remain out of order, and this is especially evident on the R75 road to Kariega where not one traffic light works, for example.
Vandalism and theft affecting water and sanitation infrastructure affects on communities and on business operations from manufacturing through to hospitality, and threatens the status of our Blue Flag beaches, a key component of our tourism economy which supports thousands of jobs.
The impact of cable theft on the rail network sees freight being moved to trucks, damaging roads and increasing costs to business, as well as hampering mining production and exports of raw materials.
These are serious crimes of economic sabotage — at the level of treason, some argue — but they are not being dealt with seriously enough.
As organised business, we are driving for this scourge to be dealt with at both ends of its illegal supply chain — both at the source, the market for scrap metal, and at the law enforcement level.
The six-month ban on scrap metal exports instituted late last year has had negligible impact in reducing these crimes and constraining the ever-expanding illicit metals market, and the Copper Development Association Africa says it has in fact only hurt the legitimate industry.
Due to the “unsatisfactory results”, the ban has been extended by a further six months, but with no apparent changes to ensure better results this time.
Is it time to impose much harsher limitations on all scrap metal dealers?
A controversial proposition, since there are legitimate businesses in this sector, doing business by the book, and providing a needed service to industry to dispose responsibly of scrap.
If not an outright ban on this sector, there certainly needs to be much stronger law enforcement in terms of regular inspections, enforcement of registration or license conditions, and arrests and businesses closed down when found to be operating illegally.
Irrespective of the proposals linked to the scrap metal export ban, the laws regulating trade in scrap metal exist. The law enforcement authorities need to be more aware of what these are, and apply and enforce them more stringently.
And both in terms of penalties for illegal operators and for the thieves who supply them, there need to be far harsher penalties, especially for repeat offenders. Alongside this, more stringent customs controls need to be implemented at our harbours.
The provisions of the law exist, particularly with the amendments to the Criminal Matters Act allowing for stiffer bail requirements and harsher penalties for infrastructure-related crime, but it appears the police and prosecuting authorities are not always aware of these, and of the severity of the crimes in terms of impact on the economy and employment.
We recently supplied the Eastern Cape Director of Public Prosecutions with detailed information on the severity of the impact of theft and vandalism of cables and infrastructure, and of truck hijackings, with the aim of arming prosecutors with the means to argue for harsher sentences.
As business, we need to take whatever action we can — and call on government to be more effective in this regard — to stop the runaway theft of the vital enabling networks that support business and employment.
Denise van Huyssteen is CEO of the Nelson Mandela Bay Business Chamber.
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