Unrest spreads in South Africa mining belt

Last updated 13:00 23/08/2012
Jacob Zuma
Reuters

UNREST SPREAD: South Africa's President Jacob Zuma addresses striking miners outside a South African mine in Rustenburg.

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Labour unrest in South Africa's platinum belt spread on Wednesday (local time), raising concerns that anger over low wages and poor living conditions could generate fresh violence after 34 striking miners were shot dead by police last week.

The strike that started last week at Lonmin's Marikana mine has driven up platinum prices and stoked worries about investing in Africa's biggest economy, where chronic unemployment and income disparities threaten social stability.

At Marikana, a sombre-looking President Jacob Zuma stood under a parasol held by an aide to address around 2,000 subdued miners.

In the Xhosa and Zulu languages, he said there was no need for workers to die in a labour dispute.

"This is painful to all of us. It is not acceptable for people to die where talks can be held. But I do feel your pain and have come personally to express that," he said.

The world's top platinum producer, Anglo American Platinum, said on Wednesday it had received a demand for a pay increase from its South African workers, while Royal Bafokeng Platinum said a labour action by about 500 miners interrupted work at a shaft at its Rasimone mine.

The price of platinum leapt to its highest since early May, driven by concern about supply from South Africa, which holds 80 per cent of the known reserves of the metal, used in jewellery and for catalytic converters in cars.

Spot platinum rose by as much as 1.5 percent to touch US$1,524.50 an ounce, trading at US$1,518.75 by 2:49 pm British time.

Ten people had been killed last week before police opened fire on striking miners on Thursday, shooting dead another 34 in the worst such bloodshed since the end of apartheid white-minority rule in 1994.

The labour troubles were touched off by a violent turf war between labour unions at the Marikana mine. Similar rumblings have emerged at other mines.

CONTAGION

"There is a very high chance that this is going to be contagious," said SBG Securities platinum analyst Justin Froneman.

"Whether or not it has been orchestrated and arranged remains to be seen, but certainly the fact that this has spread in what we viewed as a previously stable labour force is slightly concerning."

Chamber of Mines Chief Executive Bheki Sibiya, speaking for the industry group, told reporters: "The challenge is firstly to contain what happened to the area where it happened so that it doesn't spill over to somewhere else."

Workers have trickled back to Lonmin's Marikana mine this week, but most have stayed away for fear of being caught in the conflict between the long-established National Union of Mineworkers (NUM) and the militant breakaway Association of Mineworkers and Construction Union (AMCU).

AMCU president Joseph Mathunjwa told a news briefing in Rustenburg that reports of disturbances at Royal Bafokeng Platinum (RBPlat) and wage demands at Anglo American Platinum (Amplats) had nothing to do with his union.

Asked if he thought unrest would spread, he said: "I do not want to be a prophet of doom."

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President Zuma has tried to reassure investors their money is safe while appealing to all sides to end the violence.

Zuma's political foes have been piling pressure on the president. They accuse him and his African National Congress (ANC), which has placed several former NUM members in senior government positions, of adopting poor policing policies and of not caring enough about workers labouring deep underground.

 

- Reuters

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