[miningmx.com] — WAGE talks with unions to end a strike against the country’s main gold miners have brought the sides closer together and negotiations will resume on Monday, South Africa’s Chamber of Mines said on Friday.
The strike started on Thursday and could halt daily output worth up to $25m at a time when the gold price is hitting record highs on an almost daily basis.
“We are closer to each other now,” chamber spokesperson Jabu Maphalala told Reuters. He declined to say where the two sides now stood and union officials could not immediately be reached for comment.
The National Union of Mineworkers had been seeking a 14% pay hike while the companies had been offering increases of between 7% and 9%.
About 100,000 workers at AngloGold Ashanti, Gold Fields, Harmony Gold and a small miner downed tools on Thursday, demanding wage hikes of 14% against offers of 7% to 9%.
The annual “strike season” is in full swing, with unions demanding 10% to 15% pay rises, well above inflation of 5%. The strikes have so far hit chemical manufacturers, as well as coal and diamond miners.
The strikes highlight the conflicting positions within the ruling African National Congress, which is keen to draw more foreign investment and yet is in a governing alliance with organised labour.
LIQUID MARKETS, MILITANT UNIONS
South Africa is home to both the continent’s most developed capital markets and some of its most militant unions.
These unions argue the official inflation rate does not capture the full impact of rising prices on the incomes of their rank and file members, who often have several dependents.
But economists have warned steep wage settlements are eroding South Africa’s attraction as an investment destination since its workforce is already expensive and inefficient compared to its emerging market peers.
The chief executive of global miner Anglo American , which has been hurt by strikes in its coal fields and could face a stoppage at its platinum unit, said she was confident talks with workers, which will also resume on Monday, were going well.
“We have been engaging with the trade unions and would encourage them to accept,” Cynthia Carroll told reporters on a conference call, referring to the coal strike.
Investors have hammered shares of South African miners for most of this week due to concerns about the impact of lost production, and global fund trackers said redemptions from African regional funds had hit a 23-week high as a result.
The sell-off has largely ignored a surge in the price of gold , which scaled a new record high on Friday above $1,632.00 an ounce after weak economic growth data from the United States raised the prospect of further monetary easing and a weaker dollar.
After three days of steep losses, Johannesburg’s index of gold miners was little changed in late trade on Friday.
Labour strife has ended on one front. Petroleum workers accepted a deal that ended an almost three-week strike in the industry which had slowed commerce and caused panic buying at the pumps in Africa’s largest economy.
Unions representing South Africa’s 1.3 million state workers are likely to accept the government’s wage offer and avert a repeat of last year’s work stoppage which disrupted critical care at major hospitals and forced schools to shut.
“We are very close to finalising a deal. The employer has offered us 6.8 percent and we expect to take that to our members soon,” said Manie de Clerq of the Public Servants Association.
