The tightening of steel trade policies in advanced economies poses a significant threat to Africa’s industrial ambitions, warns the Pan-African Manufacturers Association (PAMA).
In a recent report, PAMA said that the EU and UK’s decision to reduce tariff-free steel import quotas will likely divert cheap steel exports to Africa, exacerbating the continent’s existing steel overcapacity issues.
The report explained that global excess steelmaking capacity is expected to exceed 720 million tonnes by 2027, which illustrates the widening gap between the world’s ability to produce steel and its capacity to absorb it commercially.
The report stressed that as major importing economies tighten market access, displaced exports are more likely to seek alternative destinations.
It stated that Africa’s steel market could face growing exposure to the diverted global exports.
Although the report noted that lower-priced imported steel may temporarily reduce production costs for downstream industries—including construction, engineering, machinery manufacturing and metal fabrication-
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