New protest halts building of vehicle plant at Coega

The BAIC construction site at the Coega Special Economic Zone
Picture: Eugene Coetzee

Small business owners demand bigger role in R11bn project

Small business owners in Nelson Mandela Bay, who are demanding millions of rands worth of contracts, yesterday staged a vehicle blockade at BAIC South Africa’s R11-billion vehicle plant under construction in Port Elizabeth, effectively stopping all work there again.

Among the latest small business attempts to participate in the project is a request to the Industrial Development Corporation (IDC) for R1.6-million “that we will dedicate towards administrative, security and logistical requirements” at the BAIC site.

Claiming to represent about 2 000 small businesses across the metro, a group of about 20 members of the Nelson Mandela Bay SMME Steering Committee used their vehicles to block a site office entrance onto the Coega Special Economic Zone site where construction of the first phase of the massive investment is now believed to be months behind schedule.

The group is one of a number of similar groups in the metro all vying for contracts at the site.

It said it intended halting all work there for the rest of this year, and into next year, should its demands not be met.

Yesterday’s development comes after the company on Friday received its first shipment of equipment for the new plant, and announced that 15% of all the components, including equipment and consumables, that will collectively comprise the manufacturing operations at the facility, would be procured locally.

Construction has been halted by SMMES several times.

This is despite engagements between representatives of Chinese automotive giant BAIC international, their partners, the IDC which is a 35% shareholder in BAIC SA, and the SMMEs.

The SMMEs have been given repeated assurances that, depending on the scope of work, they would be awarded a minimum of 35% of the contracts.

The latest stoppage comes ahead of the annual construction industry shutdown, tomorrow, with the sector returning to work on January 8. SMME Steering Committee spokesman Lindile Bobani listed a raft of allegations and demands yesterday.

They included that work meant for SMMEs had already been completed by main contractors at the site, that money meant for SMMEs had not yet been released to the sector and that they wanted to deal directly with “principals” from all of the stakeholders.

“We have been engaging around this for the past four months,” he said.

“We are demanding 35% of all the contracts. We will close this site for the rest of the year and we will come back in January when work must start again.”

He said the group believed all its members should benefit from the project.

Listing serious challenges, including that there were too many SMME groups, each with their own demands, IDC spokesman Mandla Mpangase said it was clear there were differences in the demands as outlined to the media and those expressed to the IDC.

“Thirty-five percent of the contracts have been set aside for the SMMEs,” he said.

“The SMMEs have had access to principals and leadership within the stakeholder groups.

“Abel Malinga, the IDC’s divisional executive of mining and metals industries, has met with them at least twice.

“There were demands that the paperwork involved in filing tenders was excessive – we addressed that. There was a request for a centrally located information office, we addressed that. They wanted assistance with the tendering process and we addressed that.”

He said some of the SMMEs were simply demanding contracts and were not prepared to follow the processes.

“Those who have already secured contracts within the project followed the due and correct processes.”

He stressed that engagement with SMMEs, who he called on to organise themselves appropriately, would continue, with the doors to remain open for engagement.

Mpangase said the request for R1.6-million, a copy of which is in the Herald’s possession, was an unattainable request.

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