South African Port Union Votes to Authorize Strike

 

The main labor union for South African ports operator Transnet is preparing to go out on strike by the end of the week if last-ditch wage negotiations fail. 

The United National Transport Union (UNTU) is in talks with Transnet for renewal of its labor contract, which covers more than 26,000 employees. Transnet has offered a raise of six percent per year for the next three years, but UNTU is seeking a raise of 10 percent in the first year. 

On Wednesday, the union's membership voted overwhelmingly in favor of a strike if last-minute arbitrated talks do not succeed. The negotiations run through Thursday, at which point the UNTU could stage a walkout and paralyze the nation's main seaports. 

It would be the latest in a long series of setbacks for Transnet. The state-owned company ranks among the world's least efficient port operators, and it is heavily burdened by debt. Theft, aging equipment, and alleged graft have hampered its operations for years. Its freight rail division - critical for parts of South Africa's mining sector - have underperformed for nearly a decade, crimping economic growth. Between 2017-2023, Transnet's coal-by-rail freight volume to the Richards Bay coal terminal plummeted by nearly 40 percent. 

Transnet obtained a $1 billion loan from the African Development Bank last year to support a business renewal plan, and it is recapitalizing some of its equipment. The list of investments includes seven new tugs for the ports of Durban, Cape Town, and Richards Bay. 

UNTU is the largest of several unions at Transnet. A smaller union accepted Transnet's wage offer earlier this year.