Ferrostaal invests R75m in Mandela movie


Ferrostaal, the company within the German Submarine Consortium (GSC) responsible for industrial participation, commonly called “offsets” has invested €6 million (R75 million according to the Department of Trade and Industry) in the Video Vision production of former President Nelson Mandela’s autobiography, Long Walk to Freedom.

The DTI says half “this amount was provided in the form of a loan and the other half as a grant. The terms of the loan include preferential interest rates.” It further notes 85% of the total budget of R250 million film, being produced by Anand Singh is to be spent in SA. The DTI adds the detailed terms of the contract was agreed upon by the parties. “The DTI is not party to this agreement.”

The department adds in answer to a question by Democratic Alliance MP and trade & industry shadow minister Tim Harris that the “making of this film is still in pre-production and hence it is premature to report on the realisation of the number of jobs. It is estimated that 28 000 direct and indirect jobs will be created over a two year period of the making of the film. Included in this estimate are jobs in companies providing supply side services such as set builders, carpenters, seamstresses, designers, drivers, caterers, security personnel and so forth.”

Harris last month found reference to the investment in the DTI’s National Industrial Participation Programme (NIPP) Performance Review 2009. “We are raising questions around the moral appropriateness of an arms company being investigated in several countries funding the life story of Nelson Mandela,” he said at the time.

The offset relates to the 1999 acquisition of three Type 209 diesel-electric attack submarines for the South African Navy at a cost of R8.152 billion. In terms of the report,the GSC had NIPP obligations of €2 852 460 454 which was achieved by March 31 this year. The DTI says the project “will have a positive impact on the film sector and in related supply side industries such as the music industry. The film will support skills development in the sector and will play a role in ongoing efforts to market South Africa as a suitable destination for film productions and to profile South Africa in general terms.”

The report notes NIPP came into effect in South Africa on September 1, 1996. In terms of Cabinet Memorandum 10/1996, any company selling foreign products to the state in excess of US$10 million incurs a NIPP obligation calculated at 30% of the imported content that must be discharged within a fixed timescale and reinvested into the South African economy.