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Workers at South Africa’s state-owned logistics firm Transnet will go on strike from Thursday over a wage dispute, two labour unions said, in a move that could halt the export of key minerals and other cargo.

Transnet has been operating below capacity due to a shortage of locomotives, poor maintenance and vandalism and theft of its infrastructure, costing miners billions of rand in potential revenue. A strike would paralyse freight rail services and impact South Africa’s ports, also managed by Transnet.

The United National Transport Union (UNTU), the biggest labour union at the company, said it had served notice to begin industrial action on Thursday. The other union at Transnet, South African Transport and Allied Workers Union (SATAWU), said it would join in the strike from Monday.

Both unions said Transnet’s offer of a 1.5 percent pay increase from October 1 fell below their demands.

“Transnet…must provide a salary increase offer that is aligned with the increased cost of living, cost of housing, medical costs, housing and, of course, the consumer price index (CPI) that is currently running at 7.6 percent,” UNTU said in a statement.

In recent years, the cost of living has soared in Africa’s most developed economy, worsened by the COVID-19 pandemic and the increase in prices of items like bread due to global supply chain disruptions since Russia’s invasion of Ukraine.

In July, former President Thabo Mbeki warned that there could be an “Arab Spring-type uprising” in the country due to the situation.

Transnet has said any increase beyond its current wage offer would not be sustainable.

“Transnet has consistently made the point that its wage bill currently makes up over 66 percent of monthly operating costs. This is not sustainable, particularly given the current operational and financial performance,” it said in a statement on Tuesday.

Transnet has applied to the Commission for Conciliation, Mediation and Arbitration (CCMA), a state agency that mediates labour disputes, for further talks with the unions.

Both UNTU and SATAWU said the mediation, which is due to start on October 12, would not affect their plans to go on strike.

This content was originally published here.

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