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Cape Town - On August 16 2012, nearly a year ago, 34 people died in what has come to be known as the Marikana massacre, with an overall death toll of 44 during this period of unrest.
Writing in Business Report, Nomura emerging markets expert Peter Attard Montalto said that even now, there are still "widely differing accounts of what happened and why... it’s easy to lose track of what actually happened, weighed down by competing, complex and often inconsistent politicised narratives blaming politics, individuals, systems, culture and more".
Montalto said he did not believe even the government really knows the answer to the many questions surrounding the event.
He separates two issues: the reaon for the fatalities, and the reason for protests.
"Miners were not striking because of instructions to police from political connections, nor were they killed because of housing, debt or Julius Malema," said Montalto.
"I want to look at particularly what motivated the strikes, why things turned violent, and what we can say about the outlook for the labour market from a foreign investor point of view."
Montalto singles out firstly causal and fundamental reasons, and secondly peripheral catalysts for the strikes.
Firstly, he considers "issues of trust in traditional union management and frameworks, the tripartite alliance and company and industry wage negotiating structures that have divorced the process from the worker on the bottom line".
He includes housing conditions and the migrant labour system - as well as the dual family phenomenon - in this category.
"Put simply, the fact that some aspects of mining labour are barely changed from the days of apartheid is the other fundamental cause. This in turn created the secondary issue of unsecured credit and over-indebtedness, but that is a catalyst, not a cause, in my book," said Montalto.
Inequality is also not a causal factor, said Montalto, adding that "under the right housing and migrant labour system, I believe the strikes could have been avoided even with similar inequality. At best, inequality is a catalyst."
As catalysts, Montalto lists the wider acceptance of violence seen in 2011 in service delivery and labour market protests, political and union factors such as the Association of Mineworkers and Construction Union's (Amcu's) membership drive and Julius Malema, and some of the forces reponsible for the formation of the Workers and Socialist Party.
"It is important for investors to realise that Amcu did not cause the strikes but was merely a facilitating catalyst at the time," said Montalto.
He doubts Amcu’s capacity to control its membership ranks, and points out that several themes which have been 'cemented' in the mining industry have roots that go down deeper than Marikana.
"First, labour seems to have become increasingly disaggregated – both with new unions like Amcu coming along, and with strike action across a range of sectors being increasingly led from the ground by localised groups of workers who are operating only in the very loosest sense within a union structure," said Montalto.
"Second, the wage cycle has taken on a more structural tone this year – that is, it is less about 'we want x percent increases on last year' than 'we need to be paid Rxxxx minimum'."
This has highlighted "competitiveness challenges", which are valid not just for the mining industry but also for the economy as a whole.
Montalto foresees little hope of any resolution without further violence, strikes, lowered production levels and "low levels of inward investment".
Said Montalto: "The government has regrettably shown a lack of real leadership on this issue" and "remains conflicted by a web of tenderpreneurship, empowerment and other linkages with the ANC – not to mention the tripartite alliance and the NUM’s dwindling membership base and standing in Cosatu".
With the state barely able to move because of all these conflicing issues on the one hand, and still facing pressure for greater resource nationalism on the other, "the department for mineral resources seems to be stuck between the rock of the ANC and the government’s realpolitik and its (and the minister’s) more natural sympathy with the plight of the mining companies and foreign investment".
Montalto sees mining remaining in a static position until after next year's election, with some kind of resolution only being reached during the two years after the polls. He believes that by the end of 2015, 122 000 jobs - and that is only in the platinum industry - will hang in the balance, and that strikes and violence will flare up sporadically.
"Until there is a fundamental understanding of the causal, deep, roots of the events at Marikana and the government has the political room to do something about it, it’s hard to say the lessons of a year ago have been learnt," said Montalto.
* Peter Attard Montalto is the emerging markets economist at Nomura International investment bank in London.
Writing in Business Report, Nomura emerging markets expert Peter Attard Montalto said that even now, there are still "widely differing accounts of what happened and why... it’s easy to lose track of what actually happened, weighed down by competing, complex and often inconsistent politicised narratives blaming politics, individuals, systems, culture and more".
Montalto said he did not believe even the government really knows the answer to the many questions surrounding the event.
He separates two issues: the reaon for the fatalities, and the reason for protests.
"Miners were not striking because of instructions to police from political connections, nor were they killed because of housing, debt or Julius Malema," said Montalto.
"I want to look at particularly what motivated the strikes, why things turned violent, and what we can say about the outlook for the labour market from a foreign investor point of view."
Montalto singles out firstly causal and fundamental reasons, and secondly peripheral catalysts for the strikes.
Firstly, he considers "issues of trust in traditional union management and frameworks, the tripartite alliance and company and industry wage negotiating structures that have divorced the process from the worker on the bottom line".
He includes housing conditions and the migrant labour system - as well as the dual family phenomenon - in this category.
"Put simply, the fact that some aspects of mining labour are barely changed from the days of apartheid is the other fundamental cause. This in turn created the secondary issue of unsecured credit and over-indebtedness, but that is a catalyst, not a cause, in my book," said Montalto.
Inequality is also not a causal factor, said Montalto, adding that "under the right housing and migrant labour system, I believe the strikes could have been avoided even with similar inequality. At best, inequality is a catalyst."
As catalysts, Montalto lists the wider acceptance of violence seen in 2011 in service delivery and labour market protests, political and union factors such as the Association of Mineworkers and Construction Union's (Amcu's) membership drive and Julius Malema, and some of the forces reponsible for the formation of the Workers and Socialist Party.
"It is important for investors to realise that Amcu did not cause the strikes but was merely a facilitating catalyst at the time," said Montalto.
He doubts Amcu’s capacity to control its membership ranks, and points out that several themes which have been 'cemented' in the mining industry have roots that go down deeper than Marikana.
"First, labour seems to have become increasingly disaggregated – both with new unions like Amcu coming along, and with strike action across a range of sectors being increasingly led from the ground by localised groups of workers who are operating only in the very loosest sense within a union structure," said Montalto.
"Second, the wage cycle has taken on a more structural tone this year – that is, it is less about 'we want x percent increases on last year' than 'we need to be paid Rxxxx minimum'."
This has highlighted "competitiveness challenges", which are valid not just for the mining industry but also for the economy as a whole.
Montalto foresees little hope of any resolution without further violence, strikes, lowered production levels and "low levels of inward investment".
Said Montalto: "The government has regrettably shown a lack of real leadership on this issue" and "remains conflicted by a web of tenderpreneurship, empowerment and other linkages with the ANC – not to mention the tripartite alliance and the NUM’s dwindling membership base and standing in Cosatu".
With the state barely able to move because of all these conflicing issues on the one hand, and still facing pressure for greater resource nationalism on the other, "the department for mineral resources seems to be stuck between the rock of the ANC and the government’s realpolitik and its (and the minister’s) more natural sympathy with the plight of the mining companies and foreign investment".
Montalto sees mining remaining in a static position until after next year's election, with some kind of resolution only being reached during the two years after the polls. He believes that by the end of 2015, 122 000 jobs - and that is only in the platinum industry - will hang in the balance, and that strikes and violence will flare up sporadically.
"Until there is a fundamental understanding of the causal, deep, roots of the events at Marikana and the government has the political room to do something about it, it’s hard to say the lessons of a year ago have been learnt," said Montalto.
* Peter Attard Montalto is the emerging markets economist at Nomura International investment bank in London.
