SA miners in final talks, strikes pressure Zuma

South African unions representing gold miners met with employers for final wage talks on Tuesday, saying a strike was “highly likely” if they fail to reach a deal and piling pressure on President Jacob Zuma.

“The possibility of a strike action is great and is becoming greater as each hour passes by. [The employers] are refusing to budge,” National Union of Mineworkers (NUM) spokesperson Lesiba Seshoka told Reuters during the negotiations.

A gold miners’ strike, adding to a wave of industrial action in Africa’s biggest economy, would raise pressures on Zuma to adopt a more leftist approach to economic policy.

South Africa’s powerful unions helped propel Zuma to power in an April election on a pro-poor platform and they are using their most powerful weapon—strikes—to push their agenda.

Zuma has vowed to keep pro-business policies credited with fuelling Africa’s biggest economy under predecessor Thabo Mbeki, but investors are watching for signs of rising union influence.

Workers in the gold sector last week rejected the latest offer of a rise of between 8% and 10%, said the NUM, South Africa’s biggest union.

The NUM is demanding a 15% wage hike, arguing that gold prices are near record highs. The smaller Solidarity union also turned down an offer from employers last week, calling it “unacceptable”.
Consumer inflation is 8%.

Talks are expected to continue until late on Tuesday.

Analysts say companies may be forced to cut jobs if workers insist on pay increases as high as 15 %.

“If wages go to certain levels, management could revalue their operations and retrench more people, but I hope common sense will prevail,” said Cape Town-based gold analyst at Metropolitan Asset Managers, Stephen Roelofse.

Three South African unions are holding talks with gold producers under the guidance of a mediator after failing to agree on wage increases.

South African gold producers including AngloGold Ashanti, Gold Fields and Harmony negotiate as one under the country’s Chamber of Mines.

Wage negotiations in the platinum sector are still ongoing with no specific threat yet at the world’s No 1 and No 2 producers Anglo Platinum and Impala Platinum.

Other sectors, including chemicals, paper and the national broadcaster, have been hit by a string of strikes in Africa’s biggest economy, which have come just as the country grapples with its first recession in 17 years.

Earlier this month, thousands of construction workers paralysed work on 2010 soccer World Cup stadiums during a week-long strike that was eventually settled with a 12% wage increase.—Reuters

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