It all starts at home

I read the other day that a new law requires the US Department of Defence – a major consumer of flags for everything from ships to bases to burials – only fly flags wholly sourced from home shores.

The US flag is the ultimate symbol of chest-thumping American patriotic pride. I have seen this myself when visiting companies in the US. The US flag is everywhere you go. In one case all the employees on the manufacturing floor had the symbol sewn into their uniforms.

Now the United States flag must be “100 percent made in the USA” – at least where the Pentagon is concerned.

“My recently signed law makes sure every flag bought by the US Department of Defence is 100 percent Made in America, with American products,” said Congressman Mike Thompson.

I was surprised to learn, as I am sure you are, that although US flags were already made by US companies, their material – such as fabric and ink – previously could have come from abroad. Well the Congressman has put some halt to this, and it has nothing to with the fact that his district is home to a manufacturer of flags.

Despite this I agree with the Congressman. A patriotic symbol or national assets such as minerals and natural resources should not be allowed to be exploited, whether it be our icon Nelson Mandela, our gold and the many other large quantities of raw materials that we mine, or our recycling waste, amongst others.

I understand that as an emerging country there are many scenarios to consider and we cannot be expected to be self-sufficient. However not adding value to resources or allowing imports to replace product that can easily be made locally and create employment, is not good policy. How many of us let out cries of frustration when we realise another product we have just purchased has the ‘Made in China’ words on it?

A buzzword that is taking on more significance internationally is reshoring – bringing back manufacturing jobs. There is a big drive in the mature markets to help companies understand total cost of ownership by assisting them to more accurately assess their total cost of offshoring, and shift collective thinking away from assuming that offshoring is cheaper.

Recent headlines have shown how the Australian automotive industry has been dealt a huge blow with the OEMs deciding to pull out. Reading between the lines it is quite evident that the OEMs have assessed the situation and costs, led by demanding Unions, have forced them to reshore. We have a situation locally where the catalytic converter industry is in stress (Magneti Marelli South Africa is closing its doors), an industry that has taken years to build up and be recognised and become a major income earner for the country. Total catalytic converter exports from South Africa dropped from R19.6 billion in 2011 (almost 50% of all component exports) to R16.3 billion in 2012.

Coupled with the platinum mining strikes this is not good for the country as I believe there are companies, as we speak, working on an alternative ‘new age’ material to replace platinum as it is becoming an expensive commodity.

The message is simple. Lets get our house in order at home.