Zuma warns of strike costs

Pretoria - President Jacob Zuma says the imminent gold strike could harm the continent's largest economy, cost thousands of jobs and force mine closures.

Gold miners were set to strike for higher pay from Tuesday evening, after talks between unions and companies broke down last week.

Labour unrest since last year has left more than 50 people dead and put renewed pressure on Zuma ahead of elections next year.

The rand last week slid to a four-year low.

With stoppages in vehicle and building sectors already hitting an economy suffering from slow growth and unemployment at 25%, strikes could cripple an industry that has produced a third of the world's bullion, but is now in rapid decline.

Zuma said at a briefing with reporters in Pretoria: "A strike hurts both sides. They must find a solution,"

His comments were echoed by Mining Minister Susan Shabangu, who said the government was willing to intervene to help both sides "find each other soon".

"If indeed we are going to have a protracted industrial action, it will impact negatively on the economy," Shabangu said.

"We will engage the parties if there is a need for government to intervene."

Economists say the country's economy can ill afford the lost output - estimated at more than $35m a day - from an industry shutdown in gold.

Labour and management are poles apart on wages, with the National Union of Mineworkers (NUM) seeking 60% pay hikes for entry-level miners and the Association of Mineworkers and Construction Union (Amcu), pushing for 150%.

Companies say they cannot afford the hikes in the face of soaring costs and depressed prices.

The industry has offered pay increases of up to 6.5%.