Platinum strike causing “irreparable” damage

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AMCULonmin Reuters. Miners gather at Wonderkop stadium outside the Lonmin mine in Rustenburg, northwest of Johannesburg, January 30, 2014. As South Africa's biggest post-apartheid mine strike marks its eighth week on Thursday, it is already denting growth and export earnings, and many of those affected are having to sell their most prized possessions to make ends meet. Picture taken January 30, 2014.

Johannesburg - Platinum producers Anglo American Platinum, Impala Platinum and Lonmin said on Tuesday a strike now in its ninth week at their South African mines was causing irreparable damage to the sector and local economy.

Wage talks have broken down between the companies and the striking Amcu union, which is demanding a doubling of basic wages, although the world's top three platinum producers said they were open to talks “within a reasonable settlement zone”.

In a joint statement, the companies said they had lost nearly 10 billion rand in revenues, but also pointed to the cost to communities around the mines in the platinum belt northwest of Johannesburg.

South Africa's biggest post-apartheid mine strike, which has hit 40 percent of global production of the precious metal, is also seen denting sluggish economic growth and widening the current account deficit as its effects ripple from the platinum communities throughout the wider economy.

“The financial cost ... does not tell the full story,” the companies said.

“Mines and shafts are becoming unviable; people are hungry; children are not going to school; businesses are closing and crime in the platinum belt is increasing.”

South Africa's largest labour grouping Cosatu, which includes Amcu's archrival the National Union of Mineworkers, said it supported the call for a “living wage” but accused the striking union of being irresponsible.

“We believe that it is irresponsible to take workers on such a long strike where there are no prospects of achieving the demands,” Cosatu said in a statement.

Cosatu also said the government should intervene to resolve the impasse.

The mining companies have repeatedly stated they cannot afford the demand for a 12,500 rand monthly “living wage”, saying many steps have already been taken to remedy historical inequalities in the sector.

South Africa's deputy president will meet with the mining industry and unions on Thursday for a regularly scheduled forum aimed at bringing stability to the sector.

It will be the first meeting between the companies and Amcu since wage talks collapsed almost three weeks ago.

The companies on Tuesday hinted at longer-term restructuring and mass layoffs in an industry that employs more than 100,000 people.

“Sadly, as the industry progresses towards greater mechanisation and higher skills levels, which are aligned with higher earnings and greater productivity, so the number of people employed in the industry will decrease,” they added.

South Africa has faced chronic unemployment for over a decade, with one in four people out of work.

Miners near Rustenburg, the main town in the platinum belt, told Reuters last week they were having to sell cattle to make ends meet, while local business owners spoke of collapsing trade because many migrant workers had simply gone home. - Reuters



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