UPDATE 1-South African workers protest, mines halted

(Adds COSATU, analyst quotes, mines and car makers shut)

By James Macharia

JOHANNESBURG, July 23 (Reuters) - Thousands of striking South African workers brought mines and businesses to a halt on Wednesday across four provinces to protest against a jump in electricity, food and fuel prices.

Carrying placards reading "Away with high food prices!" and "Down with high fuel prices!" the protesters snarled traffic in central Johannesburg.

The one-day walkout is part of a series of rolling strikes being held around the country, Africa's biggest economy, by labour unions to protest against rising inflation, high interest rates and likely job cuts after a power crisis engulfed the country this year.

The Congress of South African Trade Unions (COSATU) and its allies, including mineworkers, want to pressure the government to tilt policy to the left. Union leaders warned cabinet ministers to heed their demands or be swept aside.

COSATU, an ally of the ruling ANC, said its nearly two million members wanted government to pay more attention to workers.

"We don't want to pay tax on bread, salt, paraffin and fish oil," Zwelinzima Vavi, COSATU's General Secretary told about 25,000 workers at a rally outside offices owned by state power utility Eskom [ESCJ.UL] in Johannesburg.

"To the Finance Minister, we say you are not indispensable."

COSATU plans to hold a national strike on Aug. 6, when the country's mines and other businesses are expected to halt.

A sharp rise in the price of petrol, milk and bread, and a series of interest rate hikes meant to curb inflation have stoked labour's determination to change government policies.

There is rising political tension in South Africa and fear of an economic downturn. Growth has averaged about 5 percent in recent years but dropped sharply in the first quarter of 2008 as the impact of the power crisis hurt mines and manufacturing.

The strike shut mines and car makers, disrupted textile factories and brought business to a standstill in Gauteng, the province in which South Africa's commercial capital Johannesburg is located, the Eastern Cape, North West and Limpopo provinces.

MINES SHUT

The country's top three gold producers AngloGold Ashanti (ANGJ.J), the world's third largest gold producer, Gold Fields (GFIJ.J) and Harmony Gold (HARJ.J) said some of their mines had been shut and others partially affected.

Anglo Platinum (AMSJ.J), the world's top producer of the precious metal, was largely unaffected.

Economists said little could be done to change policy.

"It causes an air of instability in the country when it hurts production," Russell Lamberti, an economist at ETM said.

"I doubt, however, that there is any chance of a change of policy to sort out price increases. A price cap would distort the market, while we in South Africa are still paying low electricity prices by global standards. If Eskom is not allowed to raise prices, their business will become unviable."

Car maker Volkswagen's (VOWG.DE) main South African factory, near the eastern port city of Port Elizabeth, was shut, as were those of Ford Motor Company (F.N) and Daimler AG (DAIGn.DE).

Unions fear job losses linked to the electricity crisis that began in January when a near collapse of the system led to a five-day shut down of platinum and gold mines.

Eskom has been rationing electricity to large industrial customers since then, with mining houses threatening to shed jobs because of lower output.

Critics blame President Thabo Mbeki's government for not investing in power generation. Unions say their workers should not be made to pay for the government's lack of planning. A 27.5 percent hike in power tariffs has further annoyed unions. (Additional reporting by Phakamisa Ndzamela, Muchena Zigomo; Editing by Janet Lawrence)