CEO of Business Leadership South Africa (BLSA), Busisiwe Mavuso has flagged the country’s manufacturing crisis as missing – unmentioned in President Cyril Ramaphosa’s State of the Nation Address last week Thursday 12 February 2026.
Government needs to act urgently to safeguard and strengthen South Africa’s manufacturing sector.
BLSA has broadly welcomed the announcements made, acknowledging particularly the clarity provided by the president on the future of the electricity transmission system, which was a concern the organisation had raised following the revised unbundling plan released by Eskom and approved by Minister Ramokgopa in December last year. The president confirmed the independent Transmission System Operator will own and operate transmission assets and run the electricity market, as had been envisaged in earlier plans. Mavuso also acknowledges Necom – the National Energy Crisis Committee set up by the president in 2022 – as the right forum to manage this complex transition and ensure there are no missteps. BLSA will support that process where it can. Mavuso notes: “I am grateful to the minister and the president for taking our concerns seriously and moving quickly to provide clarity. The uncertainty that emerged in December was affecting investor confidence. Thursday's announcement removes that cloud.”
The SONA also outlined ambitious steps to improve water infrastructure and criminal justice capacity to tackle organised crime. These are critical priorities that deserve support and scrutiny as implementation begins.
However, BLSA also notes what was missing – highlighting what it sees as the biggest omission: any strategy to tackle the rapid deindustrialisation the country is witnessing. “We need a decisive response to the destruction of manufacturing capacity that took decades to build and remains key to employment creation,” Mavuso emphasises.
She points to the scale of the crisis. “In the automotive sector, tyre manufacturer Bridgestone closed its Port Elizabeth plant in 2020, and Goodyear announced the closure of its Kariega tyre plant last year. Component manufacturers producing safety belts, airbags and other critical parts have scaled back or closed: according to Naacam there were 13 closures in the past two years and more are expected. Nissan is selling its Rosslyn plant. Volkswagen has warned of uncertainty over jobs at its Kariega facility. Beyond the automotive sector, British American Tobacco South Africa announced it will close its Heidelberg plant by the end of 2026, following the destruction of the legitimate market by illicit cigarettes.
“The common thread is competition from low-cost imports, including from China, that undercut local manufacturers. Chinese vehicle models alone now account for 22% of imports. Yet the SONA offered no plan to address this.”
BLSA is calling for government to act urgently. “Finalise the new energy vehicle policy to enable manufacturers to transition to electric and hybrid production for export markets. Deploy anti-dumping measures where imports, some argue, are being sold below cost. Review tariff structures to protect local manufacturing while avoiding damage to local assemblers. Intensify enforcement against illicit trade destroying legitimate businesses. We cannot afford to wait for more factory closures to force action. Government needs to work with industry now.”
The president did briefly reference strengthening capacity for trade negotiations and expanding missions abroad to drive economic policy – but, considering South Africa’s already extensive diplomatic network – Mavuso cautions that the challenge is in effectiveness, not scale.
“Our diplomats must be equipped to advance South Africa's economic interests, identify market opportunities, and negotiate agreements that serve our industrialisation agenda. This requires a partnership with business – and BLSA is ready to help identify priority markets, connect South African exporters with potential customers, and provide input on trade negotiations. We've seen in countries like Vietnam and South Korea how business-government collaboration on trade delivers results.”
With familiar trading relationships now disrupted South Africa needs to diversify its export markets and build partnerships on its own terms. Economic trade relations are critical to the country’s safeguarding its manufacturing capabilities and industrialisation.
As the president said in his speech – we have seen what we can achieve when we work together. The progress made on critical issues through Operation Vulindlela, which continues to drive reform actions, demonstrates what can be done when government and business work in partnership with a shared focus on solving problems and moving the country forward.
For more information visit: www.blsa.org.za
