S.Africa miners' union suspends sympathy strike

JOHANNESBURG, (Reuters)

South Africa's largest union on Wednesday suspended a one-day sympathy strike this week that could have shut mines in order to give about 1.3 million striking state workers more time to consider a new wage offer.

Unions representing the state workers, who have been on a three-week strike, were expected to announce on Wednesday afternoon whether they will accept a new government offer aimed at ending the action that has shut schools and caused chaos at hospitals.

"The intention of the suspension of the secondary strike is to give public servants sufficient time to consult with members and the state to finalise its talks with labour," the National Union of Mineworkers (NUM) said in a statement.

Financial traders have said the state workers' strike has hurt sentiment but so far has had no major impact on bonds or the rand currency. One prominent economist said it has cost the economy about $150 million a day.

The labour action planned for Thursday by the NUM and other unions in the country's largest labour confederation COSATU, which claims nearly 2 million workers, could have affected mining, manufacturing and other key industries.

Other COSATU group members may follow the lead of the federation's largest member, analysts said.

A one-day strike would not likely have had much of an economic impact. But COSATU has threatened that if there was no resolution to the state workers' strike, all its group members could then go on a prolonged strike, which it said would cripple Africa's largest economy.

South Africa is the world's fourth largest gold producer and largest platinum producer. The country's biggest firms, such as Anglo Platinum, Impala Platinum and Harmony Gold Mining, have stockpiles of ore and would not be hard hit by a one-day work stoppage.

WAGE OFFER

The government offered state workers, including teachers, nurses, customs officials and office clerks, a pay rise of 7.5 percent and 800 rand ($108.5) a month for housing. The unions are demanding an 8.6 percent rise and 1,000 rand.

The coalition of more than a dozen unions representing state workers was expected to announce a collective decision on whether to accept the new offer on Wednesday afternoon.

Some groups may announce the results of the votes of their membership ahead of that time.

Officials have said the government probably will be forced to make cuts elsewhere and borrow funds to pay for the wage package for the state workers, making it more difficult to meet its goal of cutting a deficit of 6.7 percent of GDP.

The strikes have presented President Jacob Zuma with one of his most difficult policy problems since taking office and strained a long-standing governing alliance with COSATU.