* Week-long strike set to go on in Africa's largest economy
* Rand slides further to new five-year low
By Ed Stoddard
RUSTENBURG, South Africa, Jan 30 South Africa's
AMCU union rejected a 9 percent wage offer on Thursday from
leading platinum producers, prolonging a week of industrial
action that has combined with a severe emerging market sell-off
to push the rand to five-year lows.
The strike has hit around 40 percent of the global supply of
platinum, used in catalytic converters in cars, and magnified
concerns about the trade deficit in Africa's largest economy due
to its impact on a big source of foreign exchange.
Thousands of miners at a football stadium near Lonmin's
Marikana mine - scene of the police killing of 34
strikers in 2012 - reacted with boos and jeers when told about
the offer tabled after four days of government-brokered talks.
The union had been seeking a doubling of wages to 12,500
rand ($1,100) a month and its members at rival producers Anglo
American Platinum and Impala Platinum reacted
with similar disdain.
"The miners were angry about the offer," AMCU branch manager
Siphamandla Makhanya told Reuters.
The companies say they can ill-afford to double wages as
they struggle to recover from a wave of wildcat strikes, rooted
in a turf war between AMCU and the rival National Union of
Mineworkers (NUM), that battered the sector in 2012 and led to
dozens of deaths.
The rand, which plunged to a five-year low of 11.38
against the dollar on Wednesday despite the first central bank
interest rate hike in nearly six years, plumbed further depths
shortly after the AMCU decision.
MORE WILD SWINGS FEARED
At 1001 GMT it was trading at 11.3740 against the dollar and
foreign exchange dealers braced for more wild swings, either
from domestic headlines or fresh bouts of emerging market
selling by global investors.
"There are still two days of this week left but no end in
sight of the current volatility," Standard Bank trader Warrick
Butler said. "These are extremely difficult conditions to make a
market in and have the ability to pinpoint accurate support and
resistance areas when they all seem to disappear like tears in
AMCU, which has become the dominant player on the platinum
scene in the last two years, has also been trying to strike in
the gold sector, where it plays second fiddle to the established
National Union of Mineworkers (NUM).
But a labour court ruled on Thursday that its plans for a
gold strike were illegal because NUM, as the dominant union in
the sector, had already reached a wage settlement that is
considered binding on all other unions.
The AMCU has until March 14 to appeal against the decision.
The strikes have had little effect on spot platinum prices
so far but are eroding investor confidence in South
Africa at a time when a global emerging market rout has seen the
rand plunge against the dollar.
That rout forced South Africa's central bank to raise
interest rates by 50 basis points on Wednesday in step with
other emerging markets.
The strikes are also an unwelcome distraction to President
Jacob Zuma and his ruling African National Congress ahead of
elections expected in around three months' time.