Maintenance. We are currently updating the site. Please check back shortly

Thomson Reuters Foundation

Inform - Connect - Empower

INTERVIEW-S.Africa strikes less harmful for economy than before-FinMin

Source: Reuters - Sat, 29 Mar 2014 18:20 GMT
Author: Reuters
hum-war
Tweet Recommend Google + LinkedIn Email Print
Leave us a comment

* Minister seeks to downplay economic impact of strikes

* Strikes at platinum mines have been going on for 10 weeks

* Unrest rooted in historic inequality, minister says

By Tim Cocks

ABUJA, March 29 (Reuters) - Strikes affecting South Africa's platinum mines over the past 10 weeks will cause less economic damage than industrial action in 2012 and have not yet hurt exports, the country's finance minister said on Saturday.

Speaking on the sidelines of an economic conference in the Nigerian capital Abuja, Pravin Gordhan said he hoped the two sides would soon resolve their conflict, which has become South Africa's biggest industrial dispute since the end of apartheid 20 years ago and has cut global platinum output by 40 percent.

"It's unfortunate that we're actually getting a continuation of the strikes rather than settling down," Gordhan said.

"I don't think it's going to have as big an impact as it earlier had (in 2012)," he added. "The companies also have stock piles that they've been exporting, so it might be affecting production but not exports at this point in time."

Anglo American Platinum, Impala Platinum and Lonmin are locked in a dispute with workers over wages.

They have lost 10.2 billion rand ($960 million) in revenue so far, while 4.5 billion rand in employee earnings have also been lost, according to an industry website.

The government mediator met with the Association of Mineworkers and Construction Union (AMCU) on Wednesday to restart talks aimed at ending the strike.

"ALL SIDES LOSE"

Violent wildcat strikes that erupted periodically in 2012, rooted in disputes between AMCU and the National Union of Mineworkers, cost platinum and gold producers more than 16 billion rand that year, when South Africa's current account deficit was 5.2 percent of GDP.

With no resolution in sight, the cost of the present strike may eventually exceed that, analysts say, and the losses will continue to mount after it is over because operations will take a long time to get back to full production.

"All sides lose in a contest like this," Gordhan said. "The quicker they resolve their problems, the better for all."

Gordhan suggested the long-term key to resolving South Africa's social unrest would be addressing the economic inequalities that are the legacy of apartheid.

"As we celebrate 20 years of democracy shortly, that's one of the faultlines in South Africa, the huge inequalities that we inherited in 1994," he said.

While health, sanitation, housing and electricity have seen improvements, the issue of low incomes must also be addressed, he said. "The divide between the top and the bottom ... That's the next challenge we'll have to take on." ($1 = 10.5962 South African rand) (Editing by Gareth Jones)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of the Thomson Reuters Foundation. For more information see our Acceptable Use Policy.

comments powered by Disqus
Most Popular
TOPICAL CONTENT
Topical content
LATEST SLIDESHOW

Latest slideshow

See allSee all
FEATURED JOBS
Featured jobs