And, its not resolved quickly, says Economist Christo Luus, everyone in the country will feel the effects at some stage. Luus explained that while only those directly affected by the strikes will feel pressure on their pockets right now, a continued strike may have a ripple effect and become a great concern for people in other sectors.
“If there is a ripple effect, it could lead to job loss in other sectors and also very significant, deter South Africa from looking like an attractive investment.”
Luus said things like salary increases are easier if the economy is growing, but when the economy is pressured as required capital flow not balancing can put pressure on the rand which leads to inflation which affects all citizens.
Trade union Association of Mineworkers and Construction Union (AMCU) has been leading the four month-long strike, demanding a monthly salary of R12 500 for mine workers.
According to platinum wage negotiations 2014 the strike has cost mining firms around R19 billion rand in lost revenue and employees around R8.8 billion in lost wages.
The mining sector played a big role in the decrease of 0.6% in the seasonally adjusted real gross domestic product (GDP) (at market prices) first quarter of 2014…
South Africa Today – South Africa News
