New wave of strikes may cripple S.Africa's mines



REUTERS

Published — Wednesday 16 January 2013

Last update 17 January 2013 1:14 am

| نسخة PDF Print News | A A

JOHANNESBURG: Workers at three of Anglo American Platinum's South African mines went on an illegal strike yesterday, the day after the world's top producer of the precious metal announced plans to mothball shafts and cut 14,000 jobs.
A spokeswoman for Amplats, a unit of London-listed Anglo American, said an unspecified number of employees at its Khomanani, Thembelani and Tumela mines, in the heart of South Africa's platinum belt, had refused to go underground.
Only Khomanani is among the mines slated for indefinite closure or sale by the company, so the wildcat action suggests militant labor activists are making good their threat to bring sympathy strikes to other shafts.
The protests, which were expected after Anglo American unveiled its restructuring plans, combined with strong government objections to job cuts show how difficult it will be for the mining giant to push through changes critical for its recovery and that of its loss-making unit.
"The restructuring itself was fairly ambitious, it was probably not as much as some people wanted and more than others expected," analyst Jeff Largey at Macquarie in London said.
"Now it comes down to execution risk and the way things are looking right now, it is going to be more challenging than Anglo thought."
An Amplats labor leader based in the platinum belt city of Rustenburg earlier told Reuters that workers at several mines had refused to go underground overnight to protest against the company's restructuring plans.
The mining communities and shantytowns around Rustenburg, 120 kms (70 miles) northwest of Johannesburg, have been a flashpoint of labor and social unrest. Local media reported workers would be meeting later to plot wider strike action.
Amplats' share price slid over 6 percent while Anglo American's fell over 4 percent in early trade yesterday, dragging Britain's top share index down.
South Africa sits on about 80 percent of the known reserves of platinum, used to build emissions-capping catalytic converters in automobiles, but weak demand has depressed the price. It rallied to three-month highs on Tuesday because of supply concerns triggered by the Amplats proposals.
The planned retrenchments and closures, which Amplats says are needed to restore profits, risk provoking a repeat of the violent wildcat strikes in the gold and platinum sectors that resulted in more than 50 deaths last year.
They have also stirred anger from the government and ruling African National Congress (ANC) as they grapple with a jobless rate of over 25 percent and growing social discontent ahead of next year's general elections.
Mines minister Susan Shabangu lashed out at Amplats again yesterday, calling the company and its chief executive Chris Griffith "arrogant."
"Amplats decided to undermine all of us. Amplats continues to be arrogant ... They've been playing games with us," she said during an interview with SAFM radio.
"Listen to this, the arrogance of Chris. He said in his statement he's going to talk to labor. And he's not going to talk to government? He's not going to talk to us as the regulator," she said.
Anglo, which says its plan is critical to creating a sustainable platinum business, said in a statement that it took its regulatory and social responsibilities seriously.
"We will be continuing to consult with all our stakeholders on our proposals," the company said.
Adding to Anglo's woes, Kumba Iron Ore, also part of the Anglo stable, said on Wednesday that its full-year profit is likely to have fallen by about a third, hit by lower export prices and an illegal strike at its main mine.
Fueled by glaring income disparities within the industry and the wider economy, the labour unrest is also rooted in a bloody turf war between the militant newcomer Association of Mineworkers and Construction Union (AMCU) and the dominant National Union of Mineworkers (NUM).
A fresh wave of strike action on South Africa's restive platinum belt and elsewhere could be crippling to an industry battling with soaring wage and power costs and aging mines that are the deepest in the world.
"Everyone expected that when (Amplats) came through there would be some disruption, some protest. It is, though, somewhat surprising to see how far the government in particular has swung in terms of standing with the masses, playing up the popular rhetoric," Macquarie's Largey said.
Strikes would also further erode investor confidence in Africa's largest economy. The South African rand weakened against the dollar and investors pushed bonds lower yesterday because of the brewing labor unrest.

What's happening around Saudi Arabia

JEDDAH: Maj. Gen. Ibrahim Al Hamzi, director general of prisons, has sacked Brig. Ahmad Al Shahrani, director of Jeddah prisons, after the case of a video clip about prisoners taking heroin went viral, according to local media.Quoting informed source...
RIYADH: Plans are underway to shift the labor dispute commission in the Ministry of Labor to the Ministry of Justice. Related discussions were held here Thursday between Justice Minister Walid Al-Samaani and Labor Minister Mufrej Al-Haqabani.The disc...
JEDDAH: Drifting has taken a heavy toll of young men who spent their time and energy in the pursuit of this dangerous game for lack of family awareness and guidance.Observers said that the last decade witnessed a dramatic increase in traffic accident...
RIYADH: A mass brawl between migrant workers at a company along Al-Thumama Road broke out in Riyadh on Thursday, causing the death of one worker and the burning of two police vehicles.A Riyadh police source said authorities received a report on Thurs...
JEDDAH: Thousands of expatriates living in Jeddah, who are non-Arabic speakers, were excited about the monthlong 36th Jeddah Festival.The Jeddah and summer festivals this year had a number of theatrical events, entertainment programs, fireworks, arti...
MADINAH: In a tragic Madinah incident, two children died and a woman was injured in a fire which broke out in a house.Capt. Naif bin Mohammad Al-Juhani, spokesman for Civil Defense, said the control room received information about the fire incident i...
JEDDAH: Saudi Aramco said it has financed building 63,000 houses for Saudis through the citizen house owning program implemented by the company. The company said it has granted 1,037 loans to Saudis to build new houses in 2014, stressing that this pr...
RIYADH: A special team of officials from the Ministry of Health, led by Deputy Minister Hamad Aldhwilaa, visited hospitals in the southern border area to ensure that services are available to serve patients in the Asir, Jazan and Najran regions.On ar...
DAMMAM: On April 30 1935, drilling started on test well No. 1 in Dammam. After seven months, only gas was found with traces of oil at a depth of 700 meters. So it had to be plugged. Drilling began on Dammam well No. 2 on Feb. 8, 1936, and started pro...
JEDDAH: A team of doctors at King Abdul Aziz Hospital carried out emergency life-saving surgery on a Kazakh pilgrim who was suffering from a rare disease, on the night of Eid Al-Fitr, according to a website.The 17-year-old Kazakh pilgrim was brought...
JEDDAH: Members of sector committees affiliated with the Council of Saudi Chambers have tried to reach a settlement with the Ministry of Labor that would allow laborers to work on their projects during the day.The attempt was made based on an agreeme...
JEDDAH: The increase in school fees has caused parents to remove their children from private schools and enroll them in public schools in Madinah.With the approaching new school year, many parents were surprised to find that school fees were increase...
RIYADH: The size of the tourism industry has crossed the SR100-million mark with around 130 organizations in the field and the revenues generated through festivals are approximately SR11 billion annually, experts have said. The figures have been prov...
JEDDAH: A total of 105 pay-and-park areas have been opened in the city, including Jeddah historical district, downtown market place, Bab Makkah, Al Andalus Street and Palestine Street.Hani Ahmad Abdullah, media spokesperson for Jeddah Municipality, s...
RIYADH: Moroccan Ambassador Abdussalam Baraka has praised “excellent” trade and bilateral relations between his country and Saudi Arabia and expected the ties to grow further.Speaking on the occasion of Morocco’s National Day on Thursday night, the e...

Stay Connected

Facebook