SA mine tensions rumble on

Nov 02 2012 14:34

Protesting NUM miners

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Johannesburg - AngloGold Ashanti [JSE:ANG] suspended operations at one of its mines on Friday, a sign that labour tensions continue to bubble in the sector despite the official resolution to end weeks of wildcat walkouts.

The world’s third-largest bullion producer said workers halted production at its TauTona mine, 65km west of Johannesburg, with a sit-in protest over bonus payments.

“There are about 300 people doing a sit-in underground. Management is talking to them,” spokesperson Alan Fine said.

Another sit-in at the company’s Mponeng mine ended on Thursday but operations were only expected to resume on Sunday night as some repairs needed to be carried out, he added.

In the last three months, more than 80 000 miners have downed tools in the most damaging mining unrest since the end of apartheid in 1994.

The stoppages have hit platinum and gold output, threatening economic growth and have exposed President Jacob Zuma and the ANC to criticism for failing to manage labour relations.

More than 50 people have died - most of them shot dead by police - and the unrest has harmed South Africa’s reputation as an investment destination.

Financial distress

Management threats of mass dismissals, along with pay sweeteners, have ended most of the strikes in the last two weeks, but tensions at individual mines are still simmering.

On Thursday, global diversified mining firm Xstrata dismissed 400 workers on an illegal strike at its Kroondal chrome mine that had shut down most of the plant.

Anglo Platinum [JSE:AMS] (Amplats), the world’s top producer of the precious metal, is still struggling to get more 30 000 workers back to work, with an illegal strike at its Rustenburg operations now in its seventh week.

The strike has cost it 141 640 ounces of platinum so far.

Amplats' chief executive Chris Griffith said on Thursday the platinum industry was in “severe financial distress” and that high wage settlements to get wildcat strikers back to work would lead to job cuts.

Miners have been emboldened by an increase of up to 22% in wages given by platinum producer Lonmin [JSE:LON] to end a strike at its Marikana mine, where police killed 34 miners on August 16.

Junior miner Coal of Africa said it had agreed to up wages for workers at its Mooiplaats colliery by 26%, including allowances, following a legal strike at the mine. 

The SA Reserve Bank and finance ministry have warned that double digit pay increases could be inflationary. Further job losses in the industry are also expected to push up an unemployment rate already at 25.5%.

Even though Zuma’s handling of the unrest has caused internal party concern, he remains favourite to win re-election at an ANC leadership conference in December, teeing him up for another five years as national president from 2014.

mining unrest



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