El Salvador president proposes bill to overturn metals mining ban
In 2017, El Salvador became the first country in the world to ban forms of metals mining.
A week of sporadic clashes between rival unions and the police that left 10 people dead was followed on Thursday by some of the worst violence post-apartheid South Africa has experienced.
A standoff between hundreds of strikers gathered on a hilltop wielding pangas and sticks at London-listed Lonmin’s Marikana mine in the NorthWest province ended when police began firing on a surging crowds leaving 34 dead.
Natznet Tesfay, Head of Africa Forecasting for Exclusive Analysis, a UK-based risk consultancy with 1,200 analysts spread across the globe, says there is a distinct possibility for further unrest at South Africa’s mines over the next month:
The 3,000 striking miners are represented by the Association of Mineworkers and Construction Union (AMCU), which is attempting to raise its profile as an alternative to the National Union of Mineworkers (NUM), the country’s largest mining union. In early 2012, a six-week strike at Impala Platinum’s Rustenburg facility turned violent when AMCU began recruiting among NUM’s membership.”
She continued, “despite widespread condemnation of the police’s action, military and police personnel at Marikana are unlikely to withdraw, which mitigates risk of targeted damage to Lonmin’s mining assets. However, our sources state that AMCU has lost control of the striking miners who ignored AMCU calls to vacate the site. This raises the probability of further violent confrontations between security forces and striking miners over the next few days, in turn raising the risk of collateral damage to assets such as vehicles near the mining site.
If rock drill operators continue to refuse to return to work, Lonmin is likely to dismiss striking workers, triggering further violent protests and confrontations with security forces. If workers return to work, mining operations are likely to resume early next week. President Jacob Zuma’s decision to return to South Africa from a regional conference indicates the government’s intent to seek a swift end to the strike.
The NUM is a key ally of the government through its affiliation to the Congress of South African Trade Unions (COSATU). It is likely to call for AMCU to be banned. The killing of AMCU’s members at Marikana and any political action against AMCU is likely to trigger retaliatory violence against NUM members and police at other platinum mines, raising risk of violent and protracted strike action over the next month at platinum mines in South Africa. Contagion risks will also increase for coal and iron ore miners. AMCU has little membership in the gold mining sector or outside the mining sector, which shields these sectors from contagion risks.
The strike at Implats is indicative of a gradual erosion of support away from COSATU. COSATU is increasingly perceived as bureaucratic and too close to the ruling African National Congress (ANC) party. This increases the probability of splits by affiliate unions over the next year, which is likely to exacerbate and complicate future labour unrest over the next year.”
On Friday, Amcu said it has roughly 30,000 members nationally and is the recognised union at London-based Lonmin’s SA operations with 7,000 members, most of them at Lonmin’s Karee mine which is part of the Marikana complex.
On Saturday News24 reported the country’s resources minister Susan Shabango is setting up a task force to look into labour issues and that the commission of inquiry being set up by president Jacob Zuma to investigate the shootings could be a judicial one.
Lonmin has so far lost seven days of production which translates into output losses more than 15,000 platinum ounces. It produces 12% of the world’s platinum.
Spot platinum prices jumped by more than $44 an ounce on Thursday as the news about the killings broke and the precious metal settled at $1,472 on Friday, up another $36.
The metal, mainly used in catalytic converters for vehicles, is still down more than 20% compared to this time last year. South Africa accounts for 80% of global platinum production.
