Platinum Strike Affects Economy but No Recession: Governor Marcus

By Oliver Ngwenya    10-Jun-2014 20:13 UTC+02:00
Reserve Bank Governor Gill Marcus. Photo: SABC.

Reserve Bank Governor Gill Marcus. Photo: SABC.

The wage related strike by the platinum workers in the North West is set to continue amid revelations that government-led wage talks have collapsed, it was reported on Monday. The talks, in which the government seems to be suddenly taking an active interest, are between the main worker representatives, the Association of Mineworkers and Construction Union (AMCU) and the leaders in the three main platinum mining entities, that is, Lonmin, Anglo-American Platinum and Impala Platinum.

The strike, which started on the 23rd of January 2014, is mainly because the worker representatives are negotiating for a starting salary of R12 500 per month. The coalition of company CEOs argue that such a figure cannot be sustainable given the current prices of platinum on the world market and that such salaries will inevitably lead to job cuts.

There have been several sittings at the negotiating table and as many walk outs. This was a last ditch effort by the newly appointed mineral resources minister to bring the two parties to the negotiation table. On Monday, Minister Ramathlodi announced that the government was pulling out of the talks after having at least managed to get the warring parties onto the table. He did not elaborate as to the reasons why the government had pulled out of the talks. However, immediately afterwards, the ANC Secretary General, Gwede Mentashe was quoted as saying that white foreign powers were behind the strike in the platinum mines. He added that the intention of the white powers, was to destabilize the South African economy.

Commenting on the effect of the strike on the economy, the governor of the South African Reserve Bank, Gill Marcus said that while the economy was expected to continue the downward movement, a recession was highly unlikely. Governor Marcus added that she expected the South African economy to grow by about 2% in the second quarter of the year despite the shrinking of the first quarter. She also expressed optimism that at least the problem this time around, the strike was within the control of the athletes unlike six years back when the recession was a worldwide phenomenon.

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