SAfrica govt, industry urge end to transport strike

Tue May 18, 2010 3:41am EDT

Related Topics

* Transport strike enters second week

* Talks to end strike fail even after unions cut pay demand

JOHANNESBURG, May 18 (Reuters) - South Africa's government and industry leaders urged striking transport workers to resolve a wage dispute that has crippled port and rail operations in Africa's biggest economy and stranded millions of commuters.

The strike, now in its second week, has dented exports of metals, fruit and wine to Europe and Asia and slowed imports of automotive parts after nearly two-thirds of logistic group Transnet's 54,000-strong workforce joined in.

"The strike will definitely continue at Metrorail and Transnent and there are definitely no talks scheduled with Transnet," Chris de Vos, general-secretary at the United Transport and Allied Trade Union (Utatu), said on Tuesday.

Utatu and the South African Transport and Allied Workers Union (Satawu), which represent 85 percent of Transnet's workforce, want at least a 12 percent pay rise, while state-owned Transnet says it cannot afford more than 11 percent.

So far fuel supplies in South Africa and coal shipments to Europe and Asia have not been disrupted, officials said.

The strike is the latest protest in the country ahead of next month's soccer World Cup, and FIFA said imports of some equipment for the event have been affected.

The Department of Public Enterprises, which oversees Transnet, said it was concerned about the impact of a protracted strike on the economy.

The South African Chamber of Commerce said some 25 percent of the country's workforce was being denied access to passenger services.

Anglo American Plc's (AAL.L) iron ore unit in South Africa declared force majeure on shipments last week, joining other global metal exporters including Xstrata XTA.L, which said it could not supply ferrochrome to its customers. [ID:nLDE64B2B7]

"It is also disturbing that some shipping lines have diverted vessels from Durban resulting in imports and exports being seriously delayed and orders being cancelled," the chamber said.

Economists estimated the impact in the hundreds of millions of rand, but said it would quickly rise to billions as the industrial action drags on into this week.

Analysts and the central bank have criticised the unions, saying pay rises well above the 5.1 percent inflation rate would slow South Africa's economic recovery.

On Monday, Utatu and Satawu also began a strike at South Africa's Passenger Rail Agency (Prasa), halting all commuter rail operations although separate talks were being held to resolve this dispute, de Vos said. (Reporting by Agnieszka Flak)

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