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SA mine strikes spread to manufacturing sector

Toyota’s Durban
car plant “’ back
to work today after
a four-day strike
Cape Town, South Africa — 05 October 2012 – Toyota Motor Corporation says it was forced to shut its South African car factory for four days because of an illegal pay strike, the first sign of wildcat mine stoppages spreading into other parts of Africa’s biggest economy.

Reuters quotes union leaders at the Japanese car giant’s Durban plant as saying workers would return today, after winning a 5.4% pay rise inspired in part by the hefty increase won last month by strikers at Lonmin’s Marikana platinum mine.

“The circumstances are not the same as what is happening in the mines,” said Mbuso Ngubane of the National Union of Metalworkers of South Africa (NUMSA). “But it does send a message. It does have an impact to some extent on other workers getting agitated.”

After two months of unrest, at least 75,000 miners, or 15% of the sector’s workforce, are on strike, burdening already sluggish growth only three months before an internal leadership vote in the ruling African National Congress (ANC).

President Jacob Zuma is favourite to win re-election, teeing him up for a second five-year term as South African president in 2014, but the strikes and turbulence strengthen the hand of those who say he is unfit to run a sophisticated emerging economy.

Yesterday, Kumba Iron Ore, one of the world’s top 10 producers, said it had suspended production at its huge Sishen mine after striking employees had blocked access to the pit.

Wildcat industrial action at the world’s top platinum producer Anglo American Platinum (Amplats) also spread from its four mines near Rustenburg, 120 km north-west of Johannesburg, to three mines 100 km farther north, a union said.

Local radio reported that police had fired tear gas near Rustenburg yesterday at striking Amplats miners who were hurling stones.

Overnight, police said suspected wildcat strikers had burnt down two conveyors and a training centre at an Amplats mine in Rustenburg.

Meanwhile talks to end a legal strike by more than 20,000 truck drivers collapsed after unions rejected an offer of an 18% pay rise over two years, the Road Freight Employers’ Association said. Fuel suppliers are having to use police convoys to prevent drivers being attacked by gangs trying to enforce a blockade that is putting petrol stations at risk of running dry.

Fallout from the unrest in the mines, which account for 6% of GDP, has put pressure on the rand, which has fallen towards a three-year low against the dollar.

It has also fuelled concern about growth, forecast by the government at 2.7% this year.

Manufacturing makes up 15% of South Africa’s output, and widespread factory walkouts could have dramatic implications for the economy, especially with exports already suffering from economic woes in Europe, their main destination.

Major bullion producers AngloGold Ashanti and Gold Fields have also been hit by strikes.

Despite its shut-down, Kumba Iron Ore, a unit of Anglo American, said it had sufficient stockpiles and output from other mines to supply customers for "some time". Sishen mine produced nearly 40Mtof iron ore in 2011.

Source: Reuters Africa. For more information, click here.