Monday, January 21, 2013



21 January 2013



Anglo Platinum’s announcement that over 14,000 mineworkers are to be retrenched at its Rustenburg operations demands decisive steps from the South African labour movement. Last year’s strike-wave, which began on the platinum belt and spread through the gold and other sectors, has exposed how far the South African mining industry continues to rely on apartheid-era mechanisms of exploitation, and has inspired the fight for a living wage among the mass of the poorest paid, not least the farm workers.

The Amplats announcement is clearly part of the bosses’ counter-offensive to break this new spirit of militancy. It coincides with Harmony’s indefinite lockout at the Kusasalethu goldmine, while the four shafts targeted for closure in Rustenburg have the highest concentration of AMCU members. Yet, in the first half of 2012, these same shafts achieved labour-productivity and output increases of over 20% and 30% respectively, according to Amplats’ own figures.

And this is just the beginning. The big investors are urging more cuts across the platinum sector to restore their profits and roll back the challenge to the low-wage economy that underpins South African capitalism.

Zwelinzima Vavi is therefore right to declare that COSATU will resist the Amplats assault with “everything in its power”. But these words must now be put into action. The entire labour movement must be mobilised and placed on a war footing. Every effort must be made to support the elected workers’ committees - which have led the struggle for a living wage - regardless of their union affiliation. The Amplats workers must know that when they strike, there will be massive sympathy action. They are now on the frontline of a struggle whose outcome will shape the future of every worker and their dependents. 

At the same time, the Rustenburg retrenchments reflect a deeper crisis in the platinum industry. This, however, is a crisis of the bosses’ own making and demands radical solutions. Amplats complains that it is the victim of the global recession and that its profits have been hit by the downturn in platinum prices. But its problems, and that of the wider platinum industry, are over-exaggerated.  It is certainly true that world platinum prices have fallen since the financial crash of 2008. However, they are still on average almost double those of the ‘boom’ period of the early to mid-2000s and almost three times the average platinum price in the 1990s.

At the same time, Amplats and financial analysts alike have repeatedly stated that the industry’s future prospects are good. In its interim financial report (June 2012), Amplats not only says that ‘despite the current short term challenges, the longer term outlook for the platinum business remains attractive’, but boasts that ‘with its superior asset base in terms of extent and reef type, [Amplats] is well positioned to adjust project prioritisation and scheduling to match future demand’. This gets to the heart of the matter. 88% of the world’s platinum reserves are concentrated in South Africa and Amplats alone accounts for 40% of global production. Rather than being a ‘price-taker’, it is uniquely empowered to ‘make’ the world price by controlling supply – the essence of its long-term strategy.

During the boom years Amplats and its competitors rushed to expand production. However, when the global crisis hit in 2008, Amplats sacked 19,000 workers, suspended three shafts and borrowed heavily from parent company Anglo American. Despite posting record earnings of $13.3 billion at the end of 2011 and paying out R1.1-billion in dividends, Amplats launched its operational review in February 2012 to boost flagging prices by further cutting production.  This is the source of the current jobs massacre, but the shafts will be kept ticking over for when market conditions improve.

 The ANC has publicly reacted to Amplats’ announcement with anger and has threatened to revoke its Rustenburg mining licences. This is simply rhetoric. It was the ANC government that allowed Amplats and the other SA mining giants to move overseas in the first place, and Susan Shabangu’s silence on the lock-out of workers at Harmony Kusasalethu goldmine, whose chairperson is Patrice Motsepe, indicates that her outburst has little to do with the well-being of workers. But even if Shabungu and co did see their threat through, the licences would be allocated to another capitalist who, regardless of the colour of their skin, would simply add to the problem.

It is time for workers in the platinum sector to stop paying the price of the anarchy of the market. The industry as a whole must be nationalised under workers’ democratic control in conjunction with the local communities in the mining areas. Only then can production be planned on the basis of need rather than falling victim to the private corporations, whose competitive scramble is the root cause of the sector’s recurrent crises of over-accumulation. There must be massive state investment in industries that use platinum in socially useful products like catalytic converters and fuel cells, which hold out the hope of eliminating environmentally harmful emissions. The platinum sector must be a driving force of a new green economy that creates hundreds of thousands of quality climate jobs that are well-paid and secure. It must benefit the majority that produce the wealth rather than the minority who steal it, and create havoc, misery and despair for us all in their endless pursuit of profit.

For further comment on this press release:

Noor Nieftagodien 082 457 4103

Niall Reddy (079) 5129584

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