SA gold strikes could last until Christmas - union

Published: 03 September 2013

RONINGEN - If National Union of Mineworkers spokesman, Lesiba Seshoka is to be believed, the gold sector strike that begins this evening could last a great deal longer than most people are expecting.

"The way things appear at the moment, it looks as though this will be a very lengthy strike; it may last until Christmas," he told Mineweb.

This would mean roughly 80,000 gold miners, or around two thirds of the sector's employees would be on strike for an entire quarter.

Such an outcome would be crippling for the country's gold sector, which is already struggling to cope with sharp cost increases, falling grades and declining prices.

According to Reuters, "a gold industry shutdown could cost South Africa more than $35 million a day in lost output, according to calculations based on the spot gold price and a Chamber of Mines estimate that the sector would stop producing about 760 kg a day."

In a presentation clarifying the wage impasse from the employers' point of view, Harmony Gold CEO, Graham Briggs said, "Using 2012 figures as a base, a single day of strike action across the gold industry would have the following financial implications:
• daily revenue losses of around R349 million;
• daily salaries and wages lost to employees amount to around R100 million per day;
• the loss to the economy of R43 million spent on a daily basis on stores;
• electricity paid for and not productively used of around R29 million per day; and
• taxes lost to the state of some R9 million per day.

"The total economic cost is closer to R597 million per day. Last year unprotected strike action in the gold sector last year cost around R5 billion," he added.

Of course, this assumes that all of the country's gold miners go on strike which is not currently the expectation, as minority union UASA has accepted the offer and, the Association of Mineworkers and Construction Union (AMCU) remains in negotiations, or rather, is not on strike.

- minweb