www. refrigerationandaircon. co. za RACA Journal I November 2025 13
Local manufacturing spotlight
NAVIGATING CHALLENGES AND CHARTING A COURSE FOR GROWTH
By Eamonn Ryan
The South African manufacturing industry stands at a critical juncture, grappling with a complex interplay of challenges and opportunities.
At ElectraMining 2024, Eric Bruggeman, CEO of the South
African Capital Equipment Export Council( SACEEC), and managing director at Bruggeman Consulting, hosted a panel discussion that provided an overview of the current state of the sector and the significant hurdles that local manufacturers face.
While the challenges and opportunities facing South African manufacturing were brought into sharp focus at ElectraMining through the lens of the mining industry, as Bruggeman outlined the hurdles confronting local producers, these very same dynamics resonate deeply within other vital sectors. The pressures and potential discussed – from the need for supportive government policies and competitive cost structures to the imperative of import replacement and the pursuit of export markets – hold equal weight for the local manufacturing of HVAC & R equipment, a sector equally poised to either thrive or falter depending on strategic interventions and industry resilience.
The other panellists included:
• Terry Pearce, managing director at ABC Ventilation Systems SA
• Miyelani Maluleke, economist from ABSA
• Matimba Mahange, CEO of JA Engineering Works
Pearce has over 30 years’ experience in the mining industry, specifically focused on mine ventilation. ABC Ventilation Systems is a manufacturer of underground mining ventilation products that focuses on technology innovation and cost saving in the mine ventilation industry.
Bruggeman, a seasoned mechanical engineer with extensive experience, including roles at the African Development Bank( AfDB) and the World Bank focusing on the economics of machinery and equipment, painted a picture of both decline and potential.
The discussion touched upon the pervasive issue of crime, identified as a major impediment affecting all key sectors of the South African economy: manufacturing, mining, agriculture and tourism. The sheer scale of the informal economy, valued at R750- billion a year and employing over seven million people, further complicates the economic landscape. While acknowledging the need to address illegal activities within this sector, panellists also recognised the potential for encouraging legal informal economic activity as a significant source of job creation.
The overarching sentiment of the discussion underscored the critical need for a concerted effort to support local manufacturing. Suggestions included incentivising local production, implementing more effective industrial policies, and urgently addressing the high cost of electricity – a significant burden on manufacturers.
Bruggeman emphasised that overcoming these challenges requires collective responsibility, starting with individual actions. He stressed the importance of ethical conduct, reporting crime and actively participating in initiatives that foster training and opportunity for individuals. While acknowledging the positive sentiment surrounding recent political developments in the formation of the Government of National Unity, he urged South Africans to seize the current momentum and work together to create a more enabling environment for the manufacturing sector to flourish.
The discussion also touched upon the global landscape, with panellists acknowledging the increasing influx of technology and products from the East, often at competitive prices. This evolving dynamic presents both opportunities and challenges for South African manufacturers, necessitating innovation and adaptability to remain competitive in the global market.
From a manufacturing standpoint, a strong emphasis was placed on bolstering local production. The desire is for greater opportunities and tangible support from both industry and the government. This includes incentivising industrial groups to procure locally, rather than facing penalties for doing so. Furthermore, the need for strategic protection of key industries, drawing lessons from the decline of South Africa ' s textile sector due to a lack of safeguarding against foreign competition, was highlighted.
A call was made to be more assertive in protecting and prioritising the local manufacturing sector that supports it. The potential spin-offs of such a strategy are significant: increased employment, job security, enhanced training opportunities and greater confidence for long-term investors, fostering a more robust local economy.
www. refrigerationandaircon. co. za RACA Journal I November 2025 13