JOHANNESBURG - South African trade unions have called on the government to urgently review its economic policies amid a jobs bloodbath that has seen mining and manufacturing companies announce plans to retrench over 5000 employees.
Partially owned Telkom, retail giant Massmart and ferrochrome producers Merafe Resources and Samancor last week announced that they were in consultation with unions to possibly cut a combined 5765 jobs.
Solidarity deputy general secretary for mining and engineering Willie Venter yesterday admonished the government to urgently re-evaluate the existing economic policies that suppress the manufacturing industry to avert job losses.
“Although companies cite the many challenges experienced in local and international markets as reasons for retrenchments, they also consistently argue that more competitive electricity and transport tariffs are needed to be able to compete with international competitors,” said Venter.
Venter said that the government made it impossible for companies to compete internationally because of its role in increased productions costs, the erratic electricity supply and increases in electricity tariffs, which were the main reasons for the retrenchments.
Federation of Unions of South Africa acting general secretary Riefdah Ajam said the South African economy faced a conundrum of commitments made at last year’s Presidential Jobs Summit that were yet to be met by industry players.
SOUTH AFRICA - Cape Town - Massive retrenchments at Massmart Holdings Group (Graphics)
“The outlook for 2020 is very bleak. The Finance Minister (Tito Mboweni) will have to balance the fiscus by trying to reducing the headcount of public sector employees while companies including Telkom are cannibalising its employees,” Ajam said.
Samancor Chrome and Merafe Resources have announced plans to lay off 600 and 665 employees respectively.
Eskom has been the bane of the economy and has caused distress for the business community by failing to ensure a stable supply of electricity.
Merafe Resources said the retrenchments were the result of deteriorating operations and market conditions across the South African ferrochrome industry, including unsustainable electricity tariffs and interruptions, cross-subsidies and real cost inflation.
The company added that these factors had also led to the moving of significant volumes of ferrochrome production to lower-cost competitors overseas.
Last week Business Unity South Africa (Busa) urged President Cyril Ramaphosa to grab the bull by the horns and take decisive action in dealing with the challenges facing the economy.
Busa president Sipho Pityana said that the economic crisis in South Africa, especially the lack of energy security, demanded urgency, agility, quick-footed responses and yet humble and thoughtful stewardship.