Dark cloud hangs over Rustenburg as platinum strike starts 11th week

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Paul Burkhardt

Doreen Joubert sits at her Mega Pawn shop and complains that a 10-week wage strike in the world’s biggest platinum mining industry is crippling business in Rustenburg. She has taken up bead work to pass the time.

“Everyone’s pawning, but nobody is fetching,” Joubert said in front of a shelf of motorcycle helmets that she is selling in the shop she co-owns with her husband, Vagely.

It is not only the miners who are feeling the pinch. “One-man businesses are selling their power tools” because there was no work, she said.

Wage negotiations between Anglo American Platinum (Amplats), Impala Platinum (Implats) and Lonmin and more than 70 000 members of the striking Association of Mineworkers and Construction Union (Amcu) have restarted after ceasing through most of last month. The firms estimate employees have lost about R4.9 billion in pay so far.

Platinum mining, which started in the 1920s, boosted the Rustenburg economy to the point where the town became one of South Africa’s fastest-growing cities by 2000.

During the soccer World Cup, England’s national soccer team was based near the town.

Lucky Ramoroa remembers how business at his Lucky Pub, across from the Royal Bafokeng stadium, swelled during the England World Cup match against the US that ended in a 1-1 draw.

Spill-over

“It was good and it was still good until the strikes started,” he said. Since workers walked off the job 10 weeks ago, sales have fallen 45 percent.

As the platinum industry goes, so goes Rustenburg, a city of 500 000 people where mining-related activities account for about half the jobs and 60 percent of the economy, according to municipality spokesman Thapelo Matebesi.

The strike had hurt businesses from the “tuck shops” that sold matches and cigarettes to bigger business owners and contractors that could default on commercial loans, he said. “The strike has got a spill-over effect in that way.”

The municipality is also seeing less demand for its prepaid electricity packages and is facing the threat of non-payment of garbage removal fees.

“All our members, they’re really tightening up their belts over this difficult time,” said Sydwell Dokolwana, the National Union of Mineworkers (NUM) regional secretary in Rustenburg. “We have seen many people losing their cars, banks repossessing properties, vehicles and houses. There’s no food. The level of crime is now picking up.”

Even before the strike started on January 23, the town started feeling the effects of the looming labour action as tensions between the miners and the companies deepened.

“In December, we weren’t busy as usual because people knew what was coming,” said Wolfgang Kruis, the assistant manager at the Ultra Liquors store. “I would rather buy food than liquor too.”

The shop’s sales were down by 30 percent to 40 percent and people had switched to cheaper liquor brands, Kruis said, while the wholesale business was largely declining because “taverns are scared to sell until the strike is over”. The small shops and bars feared they would become targets of robbers if they maintained their normal stock levels, he said.

Violence

The strike has also worsened violence in the area. An Amcu official was killed in clashes with police and two others were arrested for the attempted murder of an Amplats worker.

A winch operator on his way to the company’s Union mine was attacked last month, according to a NUM statement.

Producers and Amcu had not made new concessions during separate talks with the Commission for Conciliation, Mediation and Arbitration during the past week, Implats spokesman Johan Theron said on Tuesday.

“It is, of course, possible that producers looking to divest from high-cost, low-productivity Rustenburg mines will be in a better position to do so the longer the strike goes on,” Mark Rosenberg, an Africa analyst at New York-based Eurasia Group, said.

There was a 35 percent chance that the strike would last until next month, he said.

“We heard rumours last year that there was going to be a long strike, but not this long,” said Morne Fourie, a salesman at the Motor World used car dealership, as he sat at his desk under the head of a stuffed warthog mounted on the wall. “Before we would move 30 cars a month; we’re lucky if we get seven out now.”

Banks were less willing to extend credit to mineworkers as the strike went on, he said. “It’s difficult for them to get approved if they work for the mine,” said Fourie, whose wife is pregnant with their second child. He works longer hours and public holidays at the lot.

“Hopefully I can sell one or two more cars.” – Bloomberg


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