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UPDATE 2-South African pharmaceutical workers launch pay strike
July 29, 2016 / 9:11 AM / a year ago

UPDATE 2-South African pharmaceutical workers launch pay strike

* Strike starts day after petrochemical workers down tools

* Potential exists for medicine supply disruptions

* Workers in many sectors seek higher-than-inflation rises (updates with employers body, details)

By Wendell Roelf

CAPE TOWN, July 29 (Reuters) - South African pharmaceutical workers began an indefinite wage strike on Friday, a day after a similar work stoppage in the petrochemical sector.

Like their colleagues in the mining, oil and manufacturing sectors, they are seeking higher-than-inflation wage increases, something policymakers say are a danger to an already weak economy.

Pharmaceutical workers want a 9 percent pay raise but employers are offering 7.5 percent this year and 7 percent next, said Clement Chitja, of the Chemical, Energy, Paper, Printing, Wood and Allied Workers union (CEPPWAWU).

“The workers are saying ‘No, No, No’ to this. Why should they agree to a pay scale going backwards,” he said.

Consumer inflation stood at 6.3 percent in June.

Around 8,000 CEPPWAWU members were expected to take part in the strike, but Jan Smit, secretary of the Pharmaceutical Employers Association (PEA), said disruption was minimal.

“The feedback from members is that there is very little disruptions, it is fairly quiet,” he said.

Drug maker Adcock Ingram said the strike had not affected its factories or distribution operations. Aspen Pharmacare said it did not engage in union-related issues through the media, and GlaxoSmithKline South Africa was unavailable for comment.

South Africa’s pharmaceutical market, the largest in Sub-Saharan Africa, was expected to grow by an average annual 6 percent to $5.1 billion by 2018 from $3.9 billion in 2013, according to a report by Deloitte issued last year.

Richard Weissenberg, healthcare unit head at consultancy Frost & Sullivan Africa, said South Africa imports a lot of its drugs and the locally manufactured generics were open to rapid substitution by importers.

“However, there is the potential for disruption to supply chains, and if that happens, then patients may be affected,” he said.

The South African Petroleum Industry Association (SAPIA), said refining, transportation and storage activities were continuing and contingency plans were in place to mitigate any impact from the petrochemicals strike.

The National Petroleum Employer’s Association has said a stagnating economy at home and weak global oil prices meant they could only offer a 7 percent raise this year, and an April CPI inflation plus 1.5 percent rise the following year.

South Africa’s central bank said on Friday it was ready to respond to renewed inflationary pressures, a signal that it is prepared to raise rates again, but remains mindful of the weak economy. (Editing by James Macharia and Robin Pomeroy)

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