The National Union of Mineworkers (NUM), led by general-secretary Gwede Mantashe, yesterday staged a march to the South African Reserve Bank, in Pretoria, in a bid to request the bank to intervene in the spate of job losses faced by the country’s mining industry, whose dollar-denominated earnings are being eroded by the strong rand.

According to NUM spokesperson Moferefere Lekorotsoana, some 2 000 workers joined in the march, which was supported by the Coalition of South African Trade Unions and the Solidarity trade union.

“We would like to see a situation where the currency can be in a range where it will impact positively on the export and import sectors. Although we recognise that marginal shafts are hurting, we do not think all the ills of the industry should be blamed on the strong rand,” Mantashe said ahead of the march, adding that most mining companies have stopped greenfield projects, while marginal miners, despite high commodity prices, are facing an uphill struggle.

The union handed a memorandum to Reserve Bank governor Tito Mboweni, suggesting that the import and export sectors would benefit from the rand being in a range of between R7,50 and R9 to the US dollar.

“More than 10 000 jobs have been shed over the past 12 months. Our union is confronted with a number of notices for further retrenchments. This will translate into more families drifting into poverty,” the memorandum stated.

“Marginal shafts are run at a loss. Greenfield projects have been stopped and new jobs promised in the Growth and Development Summit have not materialised. Employers blame the rand strength even in cases where commodity prices are at record highs. Mismanagement of the country’s resources is blamed on the strong currency.”

The NUM pointed out that the march was not an attack on inflation target policy, but an appeal for Mboweni to use other monetary tools to stabilise the South African economy.

It suggested that a reduction of interest rates would reduce the invasion of money markets by speculators with ‘hot’ money; that the Reserve Bank buys dollars more aggressively and doubles its foreign reserves; that exchange controls be removed or relaxed as they only serve to deepen stereotypes in the market; and that the bank communicates to the market that neither a very strong nor a weak currency is good for the economy.

Meanwhile, the South African Chamber of Mines came out in support of the NUM, saying the chamber also views the strong rand, as well as underlying structural problems in the economy, as having an adverse effect on the mining industry, which cannot be endured for much longer.

Chamber CEO Mzolisi Diliza said in a statement that the march on the Reserve Bank “serves to assert our industry’s collective position that the strong rand, exacerbated by uncompetitive interest rates, low levels of domestic savings, high input costs and sharp increases in administered pricing for transportation, water and energy, all serve to put heavy pressure on mining profits and, in turn, threaten thousands of jobs”.

“The chamber has been engaging government on these issues in recent years and hopes to see significant movement to stem the currency volatility, as this disempowers business planning and hampers the medium- to long-term sustainability of not only mining operations, but that of most other exporting industries,” Diliza added.

In a similar move, the Solidarity trade union yesterday also handed a memorandum to Mboweni, requesting a national emergency summit to discuss the loss of thousands of jobs as a result of the current exchange rate.

In addition, Solidarity pledged its support for the campaign by the NUM, and asked for joint action by the two trade unions.

“The overvalued rand suits the Reserve Bank’s strong focus on inflation targets, but targeting just inflation is not enough,” Solidarity said.