Postal services in South Africa risk being disrupted later this week as a union says nationwide strike action is going ahead.

The Communication Workers Union (CWU) last week threatened to strike on May 5-6 to demand higher annual pay rises for South African Post Office (Sapo) staff.

CWU is also calling for the conversion of casual Sapo workers to permanent employees.

"It's happening and we're having a press conference in the morning (Thursday, May 5),” CWU president Clyde Mervin told Fin24 by phone on Wednesday morning.

Mervin further said the strike will be “nationwide” while marches against Sapo are expected to happen on Friday.

During the last week, discussions between Sapo and CWU to try and avert the strike have not taken place, Mervin told Fin24.

But Mervin said the Sapo board want to have a meeting with CWU on Wednesday.

"They've just called us but we're waiting for a confirmation,” Mervin told Fin24.

Meanwhile, Sapo said it has received notice of a planned stay-away on May 5-6 but that it doesn’t expect postal services to be disrupted.

“Our contingency plans to deal with service interruptions are being activated and we do not expect a substantial impact on delivery standards,” said Sapo CEO Mark Barnes in a statement.

“We do not expect service at Post Office outlets to be affected either,” Barnes said.

Barnes said he’s also “communicated with all our employees regarding labour issues”.

Last week, Barnes told Fin24 that the planned CWU strike risks impacting Sapo’s capital raising efforts.

After recording a 2015 loss of R1.5-billion, Sapo has this year raised R1.8-billion from the likes of banks to help with its turnaround.

Sapo has a target of raising R2.7-billion in capital in addition to the R650-million cash injection it received from government earlier this year.

“The Post Office has started recovering in terms of service standards and is in the process of making financial improvements as well,” Barnes said in his statement on Wednesday.

“The company needs funding to address the concerns of its employees, so a strike at this time – which will jeopardise current funding arrangements – will not help to address workers’ issues,” Barnes added.Sapo is also continuing to engage with all trade unions on matters that affect employees, Barnes said.