Transport strike could harm South Africa ahead of World Cup
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The strike at South Africa' s transport utility Transnet has cost South Africa about seven billion rands (900, 000 U.S. dollars) and will have a crippling effect on the economy, Business Unity South Africa (BUSA) and economists warned on Tuesday.
They said South Africa cannot afford the strike, now in its third week, to continue for much longer while the South African public nervously watches the clock ticks down to the FIFA World Cup kick off in Johannesburg on June 11.
BUSA told The Citizen newspaper in Johannesburg that although Transnet made contingency plans to cushion key commercial sectors, the costs to the South African economy are escalating rapidly.
"Supply chains are being severely disrupted and, in many cases, export contracts have been permanently lost. Ripple economic effects are now also beginning to be discernible in the southern African region," BUSA said.
Although it is not possible to determine how much the strike has cost the economy, estimates range around seven billion rands.
BUSA said: "Beyond the overall statistical aggregates lie the devastating effects the strike is having on companies and workers in sectors like transport and agriculture.
The business organization appealed to unions to act in South Africa's national interest especially on the eve of the World Cup.
"BUSA believes unless the Transnet industrial action can be settled soon, decisive government intervention may be necessary."
Leading South African economist Mike Schussler said the South African economy was losing between 300 million 500 million rands (38.5 064.1 million U.S. dollars) daily.
"It could go much higher but it depends on the workers and the unions if they decide to go back to work or not. Most companies in the mining and fuel industries are affected, they are a much bigger industry than the agricultural industry which (has now) lost one billion rands,(128 million U.S .dollars) " said Schussler.
Transnet said on Tuesday about 65 percent of its employees had returned to work, The Citizen reported.
The South Africa Transport an Allied Workers' Union (Satawu) on Tuesday vowed to continue striking until Transnet raises its wage offer to 15 percent.
Transnet has unilaterally implemented the 11 percnet increase despite Satawu's refusal to accept it.
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