Saturday, October 06, 2012

South Africa's Amplats fires 12,000 strikers, union leader shot

By Agnieszka Flak

JOHANNESBURG (Reuters) - South Africa's Amplats fired 12,000 wildcat strikers on Friday, a high-stakes attempt by the world's biggest platinum producer to push back at a wave of illegal stoppages sweeping through the country's mining sector and beyond.

Striking platinum miners march near the Anglo-American Platinum (AMPLATS) mine near Rustenburg in South Africa's North West Province, October 5, 2012. REUTERS/Mike Hutchings

Later on, a trade union leader was shot dead near a mine run by platinum producer Lonmin in a potentially explosive escalation of the two-month-old violent labour unrest that took the death toll to 49.

National Union of Mineworkers (NUM) spokesman Lesiba Seshoka said the NUM branch leader had been killed "execution style" in the evening but gave no further details.

A six-week stoppage at Lonmin in August and September erupted out of a turf war between the NUM and the more militant Mineworkers and Construction Union (AMCU), which accuses the NUM of acting for its government allies rather than its members.

The hefty hikes won by workers from that saga has been a red rag to others while anger has been stoked by the killing of 34 miners in a hail of police bullets outside Lonmin's Marikana mine in an incident that evoked apartheid-era shootings.

The sackings at Amplats (Anglo American Platinum) on Friday triggered a sharp fall in South Africa's rand as investors dumped the country's assets.

The rand fell as much as 4 percent to 3-1/2 year lows after Johannesburg markets closed, adding to the mounting toll inflicted on Africa's biggest economy.

Strikes have spread beyond the mining sector, with Shell saying on Friday it would not be able to honour contracts to deliver fuel near Johannesburg because of a trucking strike.

The unrest is causing political trouble for President Jacob Zuma and his ruling African National Congress (ANC), the veteran liberation movement with long-standing ties to labour unions.

"You fire 12,000 people, and it's like 'Oh my god, what happens now?'" one Johannesburg-based currency strategist said.

When rival Impala Platinum fired 17,000 workers on an illegal strike rooted in the NUM/AMCU struggle, it led to a violent six week stoppage in which the company lost 80,000 ounces in output and platinum prices jumped 21 percent.

The wage deal that followed the killings at the Marikana mine in August triggered copycat demands in gold and iron ore.

"Amplats had been giving signals that it was going to hold the line after Lonmin had folded - but it's a huge gamble," said Nic Borain, an independent political analyst.

"Someone had to take it on the chin or this would have kept on unravelling and spread through the economy. It's difficult to know whether this causes the unrest to spread or whether it takes some of the sting out of it. It could go either way."

Speaking to South Africa's e-News television channel, one dismissed worker said Amplats was "starting a war".

ZUMA UNDER PRESSURE

The ANC Youth League, a fierce critic of Zuma, lashed out at Amplats, which it said "has made astronomical profits on the blood, sweat and tears of the very same workers that today the company can just fire with impunity".

"Amplats is a disgrace and a disappointment to the country at large, a representation of white monopoly capital out of touch and uncaring of the plight of the poor," it said.

Zuma tried to put a positive spin on the situation in a speech to business leaders late on Thursday, stressing that since the end of white-minority rule South Africans have shown "the capacity to overcome difficulties when we work together".

"We should not seek to portray ourselves as a nation that is perpetually fighting," he said.

However, with an ANC leadership run-off looming in December, Nelson Mandela's 100-year-old liberation movement is preoccupied with its own divisions. Zuma is seen as unlikely to take any action that could upset his political allies in the unions.

"In the build-up to the election, the government is unlikely to come out with any clear policy directives," said Simon Freemantle, an analyst at Standard Bank in Johannesburg.

Reflecting such concerns, Moody's cut South Africa's credit rating last week. Finance Minister Pravin Gordhan has already said he will have to cut his 2.7 percent growth forecast for 2012 when he delivers an interim budget on October 24.

MINER SHOT

More than 75,000 miners, or 15 percent of the workforce in a sector that accounts for 6 percent of output, have been out on unofficial strikes, and tensions with security forces and mining bosses were running high even before the mass Amplats sackings.

Near the "platinum belt" city of Rustenburg, 120 km (70 miles) northwest of Johannesburg, workers said a miner was killed by a rubber bullet fired by police on Thursday night.

Police would not confirm the cause of the death, although the ground nearby was strewn with spent rubber-bullet shell casings and teargas canisters after clashes the previous night.

On Friday, protesters in a shanty town near the Amplats mine barricaded streets with rocks and burning tyres as more than 30 riot police backed by armoured vehicles stood nearby.

AngloGold Ashanti, South Africa's biggest bullion producer, has lost virtually all local production due to wildcat strikes, while rivals Gold Fields and Harmony Gold have also taken a hit. Around 300 strikers at Kumba Iron Ore have also blockaded the company's giant Sishen mine in the remote Northern Cape province.

Apart from the mining sector, a strike with more potential to damage the wider economy is brewing in transport, with 20,000 truckers on a two-week authorised stoppage to demand higher pay.

Shell said on Friday it could not honour fuel delivery contracts around Johannesburg, declaring "force majeure" to free itself and customers from existing obligations.

"There is fuel available across the country, so the issue is not fuel supply, but the challenge is delivering it safely to our retail sites," the oil major said. Other petrol companies are holding their breath, especially around the commercial hub Johannesburg, but have not yet followed Shell's move.

Raising the stakes, transport union SATAWU said it wanted workers at railways and ports to strike next week, a development that would affect coal and other mineral shipments.

(Additional reporting by David Dolan, Wendell Roelf, Stella Mapenzauswa and Ed Stoddard; Writing by Ed Cropley; Editing by Peter Graff and Philippa Fletcher)

South Africa union pushes for wider transport strike