‘Strikes killing foreign investment’

The American Chamber of Commerce in SA says the country needs to improve labour relations.

Numsa members on strike in northern Johannesburg on 09 September 2013. Picture: Mbali Sibanyoni/EWN

JOHANNESBURG - The President of the American Chamber of Commerce in South Africa Jeff Nemeth on Wednesday echoed calls for labour relations to be improved.

Speaking to 567 CapeTalk/Talk Radio 702's Bruce Whitfield on Wednesday night, Nemeth said executives from Ford South Africa stated the recent automotive strike was a prime example of how labour unrest was affecting the country as a whole.

It's been estimated that car manufactures lose a total of R50 million per day during strikes.

But Nemeth's concern extended to the possibility that global companies were being put off from investing in the country altogether.

"The real issue here is competitiveness. As countries from all over the world are trying to develop their manufacturing sector, we really have to think about what South Africa has to offer.

"In the past, South Africa's been a very stable place to do business, especially if you wanted a business footprint on the African continent. But some of the issues here make it very difficult to come in and invest in the country."

Nemeth said Ford SA was among those companies which had been particularly hard hit.

"We've been down now for six and a half weeks; that's really unheard of in a global manufacturing environment."

He added the nature of labour negotiations in South Africa was unusual, particularly because of its "sequential nature" - the lengthy processes which need to be followed to end a wage dispute.

Referring to Tuesday's International Monetary Fund report which identified labour relations in the country as being a major factor in slow economic and employment growth, Nemeth said labour polices needed to be more flexible as this made it easier for employers to utilise the workforce.

While labour was causing a headache for the company, Nemeth said Ford South Africa would still not follow its Australian counterpart's shutdown.

He said South Africa had better initiatives in place to increase production in the automotive sector.