South Africa strikes continue

Coal and gold miners are seeking new two-year deals

The wave of industrial action sweeping South Africa's economically crucial mining and power industries will continue, as 18,000 coal miners are set to go on strike on 29 July.

Unions say talks with management at three key companies - Ingwe, owned by BHP Billiton, black empowerment company Eyesizwe and Anglo American unit Anglocoal - over pay and conditions are deadlocked.

But while the coal sector is making little headway, threats of strikes in the gold mining industry have receded, with union leaders meeting the Chamber of Mines on 27 July to discuss terms.

And some 7,500 staff from the Mineworkers Union (MWU) at the Eskom power utility are drifting back to work after a strike which began on 24 July, although 16,000 members of two other unions are holding out until they have studied a new offer.

Representatives of all three unions are meeting management on 26 July to discuss it.

Two-year deals

Spokesmen for the mining companies said the threatened 48-hour coal strike is unlikely to hit supplies immediately.

Stockpiles should take up the slack, they said.

Last year's general strike shut down South Africa

Even so, there remain fears that the action could spark wider unrest. Previous strikes in primary industries, such as those in May 2000, have spread to other sectors including public service unions.

In any case the importance of the mining industry to South Africa's economy makes a resolution crucial. While only 7% of the country's gross domestic product comes from mining, the industry provides up to 40% of exports.

And the threat of disruption both to power and mining industries, not to mention another strike threat in the steel industry, has driven the Johannesburg stock exchange to three-month lows.

The South African government has played down the disputes, pointing to the imminent expiry of two-year deals settled in 1999 as the root cause of the disagreements. The platinum mining industry, for instance, is so far unaffected, as its own two-year agreement still has some time to run.

Gold hopes

Industry observers said that brinkmanship from both management and unions had proved routine in the past during this kind of renegotiation.

South Africa's mines

Contribution to GDP: 7%

Contribution to exports: 40%

Total mining employment: 500,000 workers

But the hope is that if the gold miners can pull off a deal, then other groups could follow suit.

Mine managers have offered the lowest-earning workers a 2,000 rand (£171; $244) monthly minimum wage, with raises between 7.5% and 8.6% for workers earning above that threshold.

But the increases will have to be phased in over the course of the two-year deal.