South African business lobby groups, Business Unity South Africa (Busa) and Business Leadership South Africa (BLSA) have added their voices to many in the country, calling for a quick resolution to the ongoing strike at the state-owned enterprise Transnet.
In a joint statement, the two said that it was deeply concerned about the ongoing strike by Transnet workers and the impact it is having not only on the logistics industry in this country in the short term but also on supply chains and South Africa’s reputation in the longer run.
“There are no easy solutions on the table here – nor short-term fixes – given the financial state of Transnet’s balance sheet, higher levels of inflation, the fiscal constraints and the stresses that business are under in this challenging economic environment. Busa and BLSA have pledged to work with government and Transnet, where possible, to ensure continued limited operation of the ports where possible and similar contingency plans, to prevent overcrowding in some ports and to support Transnet’s security measures,” the groups said in a statement on Thursday.
This comes after workers rejected Transnet's revised pay offer and vowed to continue a strike that started last week, a union leader said on Thursday.
Transnet, which operates South Africa's rail freight and ports, said on Tuesday it had raised its wage offer to 4.5% from 3-4% previously, with additional 5.3% annual increases over the next two years. It also offered a 4.5% increase in medical insurance allowances this year.
But the United National Transport Union (UNTU), one of the two unions at Transnet, along with the South African Transport and Allied Workers Union (Satawu), said workers had rejected the latest offer and would remain on strike.
The Minerals Council of South Africa also urged for a speedy resolution to the strike affecting Transnet’s rail and port network.
In a statement, the council said it understood the challenges facing Transnet’s employees in terms of the rising cost of living.
“We urge the trade unions and Transnet to find a rapid resolution to the strike in the national interest. The Minerals Council, whose members account for more than 80% of Transnet’s rail business and 50% of the group’s income, is concerned that the strike is damaging exports and imports, threatening not only mining companies but the country’s fragile economy at a time when 44% of people are unemployed,“ it said.
Busa and BLSA further stated: “Whilst this is, firstly, an industrial relations dispute, we must also recognise that there are significant knock-on implications for the economy as a whole, some of which may not be immediately obvious. Such examples include the risks to the importation of medical items and of key inputs to the chemical and mining industries.
Business is also concerned if this lasts more than a few days, cargo ships will not just skip slots at South African ports but start taking South African ports out of schedules in the months ahead. This will add significant costs to either airfreight items or truck goods to and from other African ports – which will add to the inflation pressures South African’s are facing. This is why we need swift, sustainable resolution.“
The groups went on to state that short term solutions can create unintended consequences in difficult industrial relationship situations, especially if inflation remains elevated for some time and in a difficult economic and fiscal environment.
Cas Coovadia, CEO of Busa, said: “We need a quick, sustainable resolution to this strike, not ad hoc solutions. The strike risks severe damage to the economy not just in the short term, but also the longer term if it drags on and South Africa’s reputation for logistics gets further tarnished.”
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