S. African Miners Cope With Crisis
JOHANNESBURG — SOUTH AFRICA'S 270,000 black mine workers, who seriously disrupted the vital gold industry in a nationwide strike in 1987, are facing a bleak future as the industry resorts to mine closures and mass layoffs in a bid to reverse the worst crisis in its 100-year history. "The gold industry is in very severe trouble," said Adrian du Plessis, a general manager of the Chamber of Mines who will lead the country's mining houses in wage talks with the National Union of Mineworkers (NUM) later this month.
The mine workers union, which ended its annual Congress in Soweto April 28, has recognized the seriousness of the crisis and resolved that a total restructuring of the gold industry is the only way forward.
"A basic shift in international demand patterns for gold has occurred," says Cyril Ramaphosa, general-secretary of the mine workers' union. "It is increasingly obvious that the mining industry can only meet the legitimate demands of its workers if it is radically restructured."
The union still favors nationalizing the mining industry as the solution, but is debating whether this should be done industrywide or on a mine-to-mine basis. The mining houses strongly oppose nationalization but are willing to discuss other means of giving workers a bigger stake and redressing past imbalances.
The union wants an industry-wide national layoff agreement. But the mining houses insist that this can only be considered on a mine-to-mine basis, as the weaker mines would prevent them from honoring a national agreement.
In a breakthrough, the union has proposed a meeting with the mine bosses, and the Chamber of Mines, the umbrella body representing the main mining houses, has accepted in principle.
At the congress, Mr. Ramaphosa said the meeting would be a prelude to a joint invitation to the government to a three-party conference to address the industry crisis. "The mining houses are letting the gold mining industry close up shop mine by mine," Ramaphosa told the 675 delegates at the NUM conference.
During the past 18 months about 55,000 gold mine workers have been laid off, and industry bosses have warned that 80,000 jobs could be at risk in the year ahead. The turning-point came April 19 when the Anglo American Corporation, the largest mining house, said it was cutting 12,500 jobs at its two largest mines. Earlier, the General Mining Corporation and Goldfields announced several mine closings.
Mining house executives have not given up hope for the long-term prospects of gold, but they say there has been a qualitative shift in the role of gold.
"Gold is a commodity," said Clem Sunter, chairman of Anglo American's gold and uranium division. He said gold was no longer a "store of value" for which there was an insatiable demand. It was now a commodity used by jewelers, and its price would be determined by their demand for it.
Soaring production costs and a static gold price have taken their toll on South Africa's gold industry in the past few of years. In the past decade, as a percent of government revenue, gold has fallen from 25 to 0.8 percent this year because of rapidly falling profits.
Although gold remains the country's biggest foreign exchange earner, production has fallen from about 675 tons in 1980 to just over 600 tons last year, and it is estimated it could drop to 500 tons this year. South Africa's share of the world gold market has fallen over the same period - from about two-thirds to one-third, because of greater production from mines in Australia, Canada and the United States.
The mine workers were once seen as the anti-apartheid movement's best hope for forcing political changes on the government. But a deepening recession, rising unemployment, and lack of investor confidence have weakened trade union power and pressured both employers and labor to explore a different relationship.
The prospect of the union and mining houses meeting has been widely welcomed in the industry. Some believe it could be the beginning of a social contract between management and labor.
"It is very important we should be talking about the future of the industry and what can be done to save it," said the Chamber's Adrian du Plessis.
But neither side is expecting a smooth ride in an industry where antagonism between the representatives of capital and the black working-class have historically been at their most tense.