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Yuan shift fuels talk of loosening Arab currency links to dollar
By Eric Onstad
Reuters
Tuesday, August 2, 2005
http://za.today.reuters.com/news/NewsArticle.aspx?
type=businessNews&storyID=2005-08-
02T095511Z_01_ALL226685_RTRIDST_0_OZABS-MINERALS-SAFRICA-GOLD-
20050802.XML
JOHANNESBURG -- South Africa geared up for more labour unrest on
Tuesday as restive gold miners said the first country-wide strike in
the key sector in 18 years could start as early as Sunday.
A strike in the world's biggest gold-producing nation would follow a
wave of work stoppages in recent weeks by city workers, grocery
clerks and airline employees.
Frustration among miners who say they are not sharing in a booming
economy could paralyse South African mines of some of the world's
top gold producers -- AngloGold Ashanti, Gold Fields and Harmony
Gold.
Wage talks hit an impasse on Monday, but unions said a strike date
could not be set until they received formal approval from government
mediators to launch the action.
Under South African labour law, a strike can be called only when
government mediators judge that all efforts aimed at reaching an
agreement have been exhausted.
"In terms of what we think is possible, the earliest would be the
late shift on Sunday, but it might be later than that," General
Secretary Gwede Mantashe of the National Union of Mineworkers told
Reuters.
Unhappiness by the 170,000 gold miners covered in wage talks mirrors
wider dissatisfaction in a country plagued by huge income gaps
between the rich and poor more than a decade after the end of
apartheid.
A strike at South African Airways crippled the airline for nearly a
week until a deal was agreed last week and police had to fire tear
gas to disperse protesting shop assistants at major grocery chain
Pick 'n Pay.
The Chamber of Mines, an industry group that negotiates on behalf of
gold firms, said it regretted unions had rejected its latest offer
of a 4.5-5.0 percent wage hike plus bonus payments.
The bonus would kick in if the domestic gold price rose above the
current level of 90,000 rand per kg, adding one percent on to wages
for each 5,000 rand/kg above the benchmark.
"We are disappointed that deadlock has been reached in wage talks.
Exaggerated wage demands put both jobs and ounces of gold in
jeopardy. The industry can afford neither," the employers' chief
negotiator Frans Barker said in a statement released late on Monday.
Unions are demanding a 12 percent increase.
The sector has been hard hit by a strong rand over the past few
years that has slashed export income and pressured profits, even
while the dollar price of gold has soared. Thousands of jobs have
been shed as unprofitable mines have been shut.
Mining firms, which gave workers a 10 percent wage rise two years
ago, have taken a tough stand, saying they cannot afford rises much
above inflation, which is running under four percent.
Unions, however, say they need higher wages to make up for a legacy
of substandard pay and conditions during apartheid.
Wages account for around half total costs in the labour-intensive
gold sector, the biggest in terms of mining employment.
A strike would lead to the loss of around 28,000 ounces of gold
production and 79 million rand in lost revenue per day, Deutsche
Securities analyst Muneer Ismail said in a recent research note.
Shares in Harmony Gold, the world's sixth largest gold producer,
fell 2.1 percent to 51.90 rand while number four Gold Fields lost
1.4 percent to 69 rand and Anglogold Ashanti gained 0.1 percent to
225.50 rand.
They underperformed a 0.6 percent rise in the top-40 index of blue
chips.
Gold prices were steady after hitting a one-month high in Asia on
Tuesday on a weaker dollar. Spot gold was at $431.80/$432.50 an
ounce at 0930 GMT, unchanged from New York closing levels on Monday.
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