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 The two-week-old strike by 220,000 NUMSA union members, who are
seeking 12-15 percent annual increases, follows on the heels of a
five-month strike in the platinum sector that stunted economic
growth and export earnings.
The manufacturing strike has also forced General Motors to close its
assembly plant in the southern city of Port Elizabeth over a week
ago, despite efforts by Labour Minister Mildred Oliphant to mediate
between the union and employees.
"Production at our Silverton assembly plant has been temporarily
suspended due to the strike," Ford spokeswoman Alicia Chetty said on
Monday, adding that only the company's Pretoria plant was affected
and its other plant in Port Elizabeth was operating normally.
Toyota said it will halt some production from Tuesday because of
supply chain problems related to the stoppage.
"Toyota will close two production lines from Tuesday at our Durban
plant," spokeswoman Mary Willemse said.
Production at BMW, VW, Mercedes Benz and Nissan was normal, although
company officials said on Monday they were monitoring the situation
closely.
Other companies affected are construction companies Murray & Roberts
and Aveng Ltd, which are working on the construction of two
major power plants for state power utility Eskom.
NUMSA rejected the latest pay offer from employers in the steel and
engineering sector on Sunday and called on its striking members to
intensify the industrial action.
Employers have offered pay rises of 10 percent in the first year,
9.5 percent in the second year and 9 percent in the third year. But
unions also have grievances about the role of labor brokers in
industry and do not want to be bound to a multi-year agreement,
preferring a one-year deal instead.
The union and employers were due to meet on Monday for further
talks.
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The strike has damaged wider investor sentiment in Africa's most
advanced economy, which is teetering on the brink of recession after
a first-quarter contraction caused in part by the platinum strike.
Ratings agency Standard & Poor's cut South Africa's credit rating
last month while Fitch put it on negative watch, both citing poor
growth prospects mainly because of strikes.
The Reserve Bank's monetary policy committee meets on Thursday to
consider an interest rate hike amid growth concerns after the
central bank raised it by 50 basis points to 5.50 percent in
January, the first increase in almost six years.
"If growth is the main concern, governor (Gill) Marcus may be
unwilling to raise the repo rate unless the strike is resolved
soon," Francois Stofberg, an economist at Efficient Group said.
Analysts have long singled out South Africa's volatile labor
environment as a deterrent to investment.
(Reporting by Wendell Roelf; Writing by Olivia Kumwenda-Mthambo;
Editing by Ruth Pitchford)
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