* AMCU union says mines lockout would provoke violence
* Anglo American CEO warns of "economic devastation"
* Industry still recovering from deadly 2012 strikes
* South African gold industry is in steep decline
By Sherilee Lakmidas and Ed Stoddard
JOHANNESBURG, Sept 2 South African union leaders
warned on Monday, a day before a strike in the gold sector, that
mine owners' handling of pay talks could provoke violence, and
bosses said wage hikes would force mine closures and cost
thousands of jobs.
The National Union of Mineworkers (NUM), which represents
about two-thirds of more than 120,000 unionised gold miners in
Africa's biggest economy, is set to strike from Tuesday.
With stoppages in the auto industry and the construction
sector already sapping the struggling economy, shutting gold
mines could cripple an industry that has produced a third of the
world's bullion but is now in rapid decline.
Labour and management are poles apart on the issue of wages,
with the NUM seeking 60 percent pay hikes for entry-level miners
and its more hardline rival, the Association of Mineworkers and
Construction Union (AMCU), pushing for 150 percent raises.
Companies say they cannot afford this in the face of soaring
costs and depressed prices. The president of South Africa's
Chamber of Mines warned unions against stoking workers' hopes.
Mark Cutifani, who is also chief executive of mining giant
Anglo American said, "Promoting expectations above the
capacity of the industry to pay is a dangerous road that may
have tragic consequences for employees who do not understand how
close we are to economic devastation in certain sectors."
"If we lose each other in the present discussions, we will
count the costs in mines closed and tens of thousands of jobs
lost," he wrote in a commentary in the Business Day newspaper.
South Africa's gold and platinum sectors are still
recovering from a wave of violent, wildcat strikes last year.
Stemming from a turf war between the NUM and AMCU, it cost
billions of dollars in lost output and triggered damaging
sovereign credit downgrades. More than 50 people were killed.
Business Day said gold producers were considering a
pre-emptive lockout at the mines. The Chamber of Mines, which
negotiates on behalf of firms, told Reuters a lockout was an
option but it would be taken as a "last resort".
AMCU President Joseph Mathunjwa, whose union has not yet
called a strike, said a mines lockout would provoke trouble.
"I have informed the minister of police that the manner in
which the gold CEOs want to approach this wage negotiation,
through an offensive lockout, will result in violence," he said.
"A strike is not what we are after, we are being pushed into
a corner," Mathunjwa said.
FALLEN GOLD GIANT
Critics say President Jacob Zuma and his ruling African
National Congress (ANC) have paid more attention to a small and
wealthy business elite, including mine bosses, and ignored the
needs of South Africa's working class, poor and unemployed.
The government is anxious to keep a lid on labour unrest and
potential job losses before elections next year.
A gold industry shutdown could cost South Africa more than
$35 million a day in lost output, according to calculations
based on the spot gold price and a Chamber of Mines estimate
that the sector would stop producing about 760 kg a day.
South Africa's gold industry, which once accounted for
almost 80 percent of global bullion output, now produces just 6
percent of the world total.
It has been laid low by a combination of geological and
economic setbacks. After more than a century of mining, the
remaining ore lies deep underground and is costly and dangerous
to extract. Labour and power costs have also soared.
Monday brought some relief however from the strike pressure,
when workers at petrol stations and car dealerships postponed
for a week a stoppage which was scheduled to start on Monday.
But striking car manufacturing workers stayed away from work
after rejecting a double-digit wage increase offer on Thursday.
The auto industry strike is costing the economy an estimated $60
million a day.
Labour worries pushed the rand to four-year lows last month.
Companies which will be hit by Tuesday's strike include main
gold producers AngloGold Ashanti, Gold Fields,
Harmony Gold and Sibanye Gold.