SA govt moves to end strike as recession looms

[miningmx.com] – THE prospect that the 18-week strike in the platinum sector could plunge South Africa into a recession has impelled the country’s government into calling a ‘technical team’ which will ‘broaden’ the approach to settling the strike.

Newly appointed mines minister, Ngoako Ramatlhodi, said the team would meet from May 29 at an undisclosed venue and consist of representatives from the departments of mineral resources and labour, and the national treasury.

A 24.7% slide in mining and quarrying saw economic growth decline in the first quarter. Given that two months of the strike fall in the second quarter, there’s a real risk that South Africa could be plunged into a technical recession.

Seasonally adjusted and annualised gross domestic product (GDP) fell 0.6% in the first quarter compared with a 3.8% increase in the fourth quarter of last year.

The technical team will be supported by representatives from the platinum companies, as well as the Association of Mineworkers and Construction Union (AMCU), and follows a meeting today with Lonmin, Impala Platinum and Anglo American Platinum as well as the Chamber of Mines of South Africa.

“The mandate of the technical team is to broaden the approach and explore all possibilities for a resolution to the problem,” said Ramatlhodi in a statement. “They will interrogate all the information (including the figures) provided by both parties, and report back by the end of the day on what is possible,’ he said.

“All parties are hurting. The workers are hurting. We have no option but to find an amicable solution,’ he said.

It’s unclear whether the formation of the technical team means that mediation which began under the auspices of the Labour Court since May 21 has failed. Ramatlhodi said government remained supportive of the process.

The strike enters its 19th week tomorrow (May 29) and is almost certain to result in permanent damage to South Africa’s platinum sector. Lonmin and Amplats have said it would result in retrenchments and restructuring.

AMCU is calling for a basic wage of R12,500 per month for all workers, a demand that the platinum companies say is unsustainable. In April, the platinum firms offered a total cash payout of R12,500/month by 2017 which equated to annual increases of between 7.5% and 10%.