Mpact CEO: Why China’s recycling policy changes are favourable for SA

Paper and plastics group Mpact has reported a revenue jump of 4.2 percent to R5.2 billion for the interim period ending in June. Underlying earnings per share have also increased by 25.1 percent to 39.4 cents. Bruce Strong, Chief Executive Officer of Mpact, attributes these positive results to the company's strategic investments in manufacturing capabilities over the past five to six years, totaling over 1.6 billion rand. These investments have led to efficiencies in energy, water usage, and productivity, enabling Mpact to navigate a challenging local economy. Despite facing difficulties in the demand from the local market, Mpact's diversified business portfolio, including an extensive network of recycling facilities, has helped sustain the company's performance. The CEO emphasizes the importance of stability in the Rand exchange rate for long-term competitiveness, highlighting the need for a favorable business environment in South Africa. While acknowledging the challenges posed by state-owned enterprises, government finances, and bureaucratic barriers, Strong calls for a reduction in red tape to support the growth of small businesses and entrepreneurs in the country. In response to China's recycling policy changes, Mpact views the restrictions on imports by China as favorable for South Africa and the recycling industry. Strong notes that South Africa's established manufacturing and processing infrastructure for recyclables position the country well to mitigate the impact of the Chinese policy interventions. Looking ahead, Strong acknowledges the ongoing economic difficulties in South Africa but remains optimistic about the country's resilience and resourcefulness. He emphasizes the need for businesses to adapt and make strategic decisions to weather the current economic challenges and pave the way for a brighter future.