News / Economy

South Africa Platinum Strike Cripples Mine Companies

FILE - A miner gestures as they gather at Wonderkop stadium outside the Lonmin mine in Rustenburg, northwest of Johannesburg, Jan. 30, 2014.
FILE - A miner gestures as they gather at Wonderkop stadium outside the Lonmin mine in Rustenburg, northwest of Johannesburg, Jan. 30, 2014.
Hope for a settlement this week of South Africa's prolonged platinum miners strike was dashed when the country's largest mining union boycotted a meeting chaired by South Africa's deputy president.
 
Thousands of platinum mine workers belonging to the country’s largest mining union, the Association of Mineworkers and Construction Union (AMCU), went on strike on January 23 demanding a monthly basic salary of $1,181. A series of talks to end the strike has so far failed.
 
On Thursday, South African Deputy President Kgalema Motlanthe convened a meeting of all stakeholders to discuss peace and stability in the entire mining sector. However, AMCU boycotted the meeting and instead marched to the Impala Platinum Mine headquarters in Johannesburg to demand better wages.
 
Union leader Joseph Mathunjwa vowed to keep the workers on strike until their demands were met. He had no kind words for the mine bosses.
 
"Some of them, they have never even, been to those underground harsh conditions that we are facing 365 days, but they are walloping immense salaries. Why?" asked Mathunjwa.
 
South Africa's Minerals Resources Minister, Suzan Shabangu, made a passionate call for all involved to bring the strike to an end.
 
"The situation is highly destitute (desperate), indeed we would like to see parties being able to resolve the matter. As we know that this strike is not only hurting the workers it’s hurting the country too. We really want a resolution… to the strike itself," said Shabangu.
 
Economists have warned that the strike is already having a negative impact on both the mining industry and the economy at large. So far, platinum mines have lost over $944 million in revenue while workers have lost $378 million in salaries.
 
Kevin Lings, an economist from the investment firm Stanlib, said continuation of the strike could collapse the mining sector.
 
"It’s very difficult for business to move forward, when you have got this much labor unrest, whether its mining or manufacturing, it’s usually disruptive to business to have this much labor unrest, and obviously we need to implement policy more effectively from a government perspective, in terms of infrastructure development," said Lings.
 
The strike is taking a toll on companies and workers alike. Lonmin, a giant platinum mine, recently asked its non-striking workers to go on leave, saying this will cut costs and help the company to survive.
 
With mining contributing about 20 percent of South Africa’s gross domestic product (GDP), Leon Louw, Executive Director at the Free Market Foundation, an economic think tank, said the economy is taking a beating.
 
"The South African economy, is now stagnating, or growing at very, very low rates. This is all very tragic, very sad and very serious and not being taken nearly seriously enough by most commentators and by the government in particular," said Louw.
 
Daryl Glaser, Head of Department of Political Studies at the University of Witwatersrand, said the government’s failure to properly resolve issues in the mining sector and the economy at large could haunt the ruling African National Congress in the coming elections.
 
"The dissatisfaction with the ANC is potentially providing recruits to new and breakaway political parties. They potentially find recruits in workers who are unhappy. It remains to be seen how much advantage they are going to be able to take of the dissatisfaction," said Glaser.
 
With only a few weeks left before South Africa's national elections on May 6, it is not clear how long the government can afford to wait as the platinum sector strike punishes workers, business and the economy.

You May Like

Will Cuba Follow the Southeast Asia Model?

Decision to restore ties between US and Cuba has some debating whether it will lead to an enhancement or regression of democracy on the Communist island nation More

Kenyan Designer Finds Her Niche in Fashion Industry

‘Made in China’ fabrics underlie her success More

Report: CIA, Israel's Mossad Killed Senior Hezbollah Commander

The Washington Post story says Imad Mughniyah was killed instantly by a bomb "triggered remotely" from Tel Aviv by Mossad agents More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Jefferson's Library Continues to Impress, 200 Years Lateri
X
Deborah Block
January 31, 2015 12:12 AM
Two hundred years after the U.S. Congress purchased a huge collection of books belonging to former President Thomas Jefferson, it remains one of America’s greatest literal treasures and has become the centerpiece of Washington’s Library of Congress. VOA’s Deborah Block reports.
Video

Video Jefferson's Library Continues to Impress, 200 Years Later

Two hundred years after the U.S. Congress purchased a huge collection of books belonging to former President Thomas Jefferson, it remains one of America’s greatest literal treasures and has become the centerpiece of Washington’s Library of Congress. VOA’s Deborah Block reports.
Video

Video Egypt's Suez Canal Dreams Tempered by Continued Unrest

Egypt plans to expand the Suez Canal, raising hopes that the end of its economic crisis may be in sight. But some analysts say they expect the project may cost too much and take too long to make life better for everyday Egyptians. VOA's Heather Murdock reports.
Video

Video Threat of Creeping Lava Has Hawaiians on Edge

Residents of the small town of Pahoa on the Big Island of Hawaii face an advancing threat from the Kilauea volcano. Local residents are keeping a watchful eye on creeping lava. Mike O’Sullivan reports.
Video

Video Pro-Kremlin Youth Group Creatively Promotes 'Patriotic' Propaganda

As Russia's President Vladimir Putin faces international pressure over Ukraine and a failing economy, unofficial domestic groups are rallying to his support. One such youth organization, CET, or Network, uses creative multimedia to appeal to Russia's urban youth with patriotic propaganda. VOA's Daniel Schearf reports.
Video

Video Filmmakers Produce Hand-Painted Documentary on Van Gogh

The troubled life of the famous 19th century Dutch painter Vincent van Gogh has been told through many books and films, but never in the way a group of filmmakers now intends to do. "Loving Vincent " will be the first ever feature-length film made of animated hand-painted images, done in the style of the late artist. VOA’s George Putic reports.
Video

Video Issues or Ethnicity? Question Divides Nigeria

As Nigeria goes to the polls next month, many expect the two top presidential contenders to gain much of their support from constituencies organized along ethnic or religious lines. But are faith and regional blocs really what political power in Nigeria is about? Chris Stein reports.
Video

Video Rock-Consuming Organisms Alter Views of Life Processes

Scientists thought they knew much about how life works, until a discovery more than two decades ago challenged conventional beliefs. Scientists found that there are organisms that breathe rocks. And it is only recently that the scientific community is accepting that there are organisms that could get energy out of rocks. Correspondent Elizabeth Lee reports.
Video

Video Paris Attacks Highlight Global Weapons Black Market

As law enforcement officials piece together how the Paris and Belgian terror cells carried out their recent attacks, questions are being asked about how they obtained military grade assault weapons - which are illegal in the European Union. As VOA's Jeff Swicord reports, experts say there is a very active worldwide black market for these weapons, and criminals and terrorists are buying.
Video

Video Activists Accuse China of Targeting Religious Freedom

The U.S.-based Chinese religious rights group ChinaAid says 2014 was the worst year for religious freedom in China since the end of the Cultural Revolution. As Ye Fan reports, activists say Beijing has been tightening religious controls ever since Chinese leader Xi Jinping came to office. Hu Wei narrates.
Video

Video Theologians Cast Doubt on Morality of Drone Strikes

In 2006, stirred by photos of U.S. soldiers mistreating Iraqi prisoners, a group of American faith leaders and academics launched the National Religious Campaign Against Torture. It played an important role in getting Congress to investigate, and the president to ban, torture. VOA's Jerome Socolovsky reports.
Video

Video Former Sudan 'Lost Boy' Becomes Chess Master in NYC

In the mid-1980’s, thousands of Sudanese boys escaped the country's civil war by walking for weeks, then months and finally for more than a year, up to 1,500 kilometers across three countries. The so-called Lost Boys of the Sudan had little time for games. But one of them later mastered the game of chess, and now teaches it to children in the New York area. VOA’s Bernard Shusman in New York has his story.
Video

Video NASA Monitors Earth’s Vital Signs From Space

The U.S. space agency, NASA, is wrapping up its busiest 12-month period in more than a decade, with three missions launched in 2014 and two this month, one in early January and the fifth scheduled for January 29. As VOA’s Rosanne Skirble reports, the instruments being lifted into orbit are focused on Earth’s vital life support systems and how they are responding to a warmer planet.

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

All About America

AppleAndroid

World Currencies

EUR
USD
0.8845
JPY
USD
117.71
GBP
USD
0.6643
CAD
USD
1.2669
INR
USD
62.019

Rates may not be current.