* Pay increase encourages other worker wage demands
* Lonmin workers celebrate "death of NUM"
* Death toll from unrest rises to 46
* Zuma "relieved" but still under pressure
By Sherilee Lakmidas
MARIKANA, South Africa, Sept 19 South African
police fired tear gas and rubber bullets on Wednesday to
disperse protesters near a mine run by the world's biggest
platinum producer Anglo American Platinum, as unrest
spread after strikers at rival Lonmin won big pay rises.
Within hours of Lonmin agreeing wage
increases of up to 22 percent, workers at nearby mines called
for similar raises, spelling more trouble after six weeks of
industrial action that has claimed more than 40 lives and rocked
Africa's largest economy.
"We want management to meet us as well now," an organiser
for the militant Association of Mineworkers and Construction
Union (AMCU) at Impala Platinum, the second biggest
platinum producer, told Reuters.
"We want 9,000 rand ($1,100) a month as a basic wage instead
of the roughly 5,000 rand we are getting," said the organiser,
who declined to be named fearing recriminations from the firm.
The death toll from the unrest rose to 46 when a woman died
several days after being struck by a rubber bullet, a clergyman
who has been counselling striking miners, told Reuters.
Jubilant workers at Lonmin's Marikana mine, 100 km (60
miles) northwest of Johannesburg, painted the wage deal as a
victory for AMCU over the dominant National Union of Mineworkers
(NUM), an ally of the ruling African National Congress.
President Jacob Zuma expressed relief at the pay deal after
intense criticism from the opposition and media of the
government's handling of the crisis - not least in the aftermath
of the police killing of 34 Marikana miners on Aug. 16.
The shootings, the bloodiest security incident in democratic
South Africa's 18-year history, boosted an "Anyone but Zuma"
campaign dividing the ANC, although he remains favourite to win
an internal leadership election in December.
The violence rekindled memories of apartheid-era clashes
when police representing white-minority rulers fired on masses
of blacks seeking freedom. This time it was the ANC government's
police, black and white, who shot the workers, all black.
REALITY OF EXTRA COSTS
Lonmin shares rose more than 9 percent on news of the pay
deal, but gave up most of those gains during the day as the
reality of the extra costs to a company struggling with a shaky
balance sheet and unprofitable mine shafts sank in.
The wage deal could add 13 percent to the group's recurrent
costs, plus an additional $10 million for a one-off back-to-work
bonus, Nomura said in a note.
The end of the strike will give Lonmin a stronger hand in
its refinancing talks with lenders, say analysts, who believe it
can withstand higher wages despite its stretched balance sheet.
Acting Chief Executive Simon Scott said Lonmin would be able
to manage the hit to its finances: "I am not sure we've bought
peace and I'm not sure we've put a band-aid on here," he told
Talk Radio 702 in South Africa. "I would like to think that what
we've done is something more sustainable."
While Lonmin had relative peace, police fired tear gas and
stun grenades to disperse a crowd of men carrying traditional
weapons, including spears, in a township at a nearby Anglo
American Platinum (Amplats) mine outside the city of Rustenburg.
A labour activist said workers who had stayed off the job at
Amplats, which accounts for 40 percent of global supplies of the
metal used for catalytic converters in cars and jewellery, were
inspired by Lonmin and would press on with their demands.
Platinum prices rose a little on Wednesday after
falling 2.6 percent a day earlier on news of the Lonmin deal.
At Marikana, strikers celebrated the deal as a triumph for
AMCU, which exploded onto the labour scene in January when its
turf war with the NUM led to a six-week closure of the world's
largest platinum mine, run by Implats.
Thousands of workers and their families gathered at a soccer
pitch near the mine to sing victory songs and denounce the NUM.
"I am happy now," said 42-year-old rock-driller Simphiwe
Booi. "Now we can eat."
MAKING ENDS MEET
The 100-year-old ANC was born out of South Africa's fight
against white rule, and rejected the exploitation of poor black
miners toiling in the country's fabled gold reefs and other
Led by Nelson Mandela, the ANC promised a better life for
all when it took power on the end of apartheid in 1994.
But despite billions of dollars spent on infrastructure,
housing, healthcare and education, income disparity and
unemployment have increased while chronic joblessness has helped
entrench a massive underclass.
While mineworkers have seen their wages steadily increase
over the years and mining firms have built schools, hospitals
and roads to help communities around their shafts, many of the
500,000 people in the industry still struggle to make ends meet.
Economists said Lonmin may have set a precedent for wage
settlements that could spread through an economy already saddled
with globally uncompetitive costs.
"The outcome of the negotiation at Marikana will likely set
a new benchmark for mining more generally and wage costs are set
to rise substantially," JP Morgan said in a research note.
Should wage hikes take root, they would also be likely to
stoke wider inflation and curb the central bank's ability to cut
interest rates to boost anaemic economic growth.
The gold sector has also not been spared, with 15,000 miners
at the KDC West operation of Gold Fields, the world's
fourth largest bullion producer, on an illegal strike.
Amplats shares were unchanged while Implats closed 1.1