Mittal forces a return to the negotiating table

- The Walloon government and the unions were hoping to find a buyer to save the Liège-based steel plant.

- Their plan has officially failed. Subsequently, ArcelorMittal wants to restructure the cold phase as quickly as possible (1,300 jobs at risk). They intend to do this with very little negotiating leeway during the next three party meeting.

The Walloon government committed to asking ArcelorMittal to return to the negotiating table two days after the multinational company gave its ultimatum. The purpose was to speed up the negotiations regarding the Liège-based cold phase restructuring announced on January 24th. 1,300 jobs hang in the balance.

No one’s pride is on the line. These negotiations will take place within a three-party framework (the Walloon region will partner with the unions in discussions with the multinational) “with coordinated conditions and timing.” No one will be locking themselves into a painfully tight time frame or into the group’s previous proposals.

As a recap, a few weeks ago ArcelorMittal had offered to soften the blow of its restructuring process. It would reduce the cold process finishing equipment by more than half, saving one extra line. Also, it would guarantee a volume for the 5 most strategic lines, and put the lines that were shut down in mothballs so they would not be dismantled. To top it off, it would implement a €138 million investment program. If no progress is made with the unions, ArcelorMittal threatens to revert to its January 24th plan, pointing to the fact that the Liège site is continuing to lose money as the reason for the urgency.

The Walloon government’s negotiating goal remains the same: “to arrive at a final agreement that will guarantee the longevity of the steel plant’s activity in as many areas as possible.” However, there has been considerable backpedaling since last January. The only remaining option is to take over the Liège steel plant from ArcelorMittal since no other buyer has stepped forward.

Is this a transfer operation (the region temporarily taking over the equipment) occurring in the hopes that a future buyer would eventually surface? No one even dares speak of it anymore. The government is finally confirming its commitment to “support and reinforce the steel region’s reorganization and conversion through the implementation of the ’Plan for Liège.’ It will include the means consistent with the potential challenges, and will mobilize all necessary resources”.

Following the meeting at the Elysette, the government seat in Namur, the unions were making the best of a bad situation. “There is neither a buyer nor a transfer at the moment. ArcelorMittal is acting like an intransigent partner,” observes Jordan Atanasov, the regional secretary of CSC-Métal. “The government was correct in reminding the group that no one negotiates under an ultimatum. The most important thing is to be able to sit down together to talk about an industrial and a social plan. The region’s involvement in the three-way meeting is a good sign. The public authorities will be brought to the table and pledge funds for investments to gain the group’s trust in its commitments.”

The FGTB remains wary. “The negotiations need to be serious and reflect the January 24th announcement – not just the latest conditions proposed by ArcelorMittal,” warns Jean-Luc Rader, the FGTB-Métal regional secretary. “Our goal is to keep all 12 cold phase lines. If management starts with the hypothesis that half of them are already off-line, I don’t see what we have left to talk about.”

The blast furnaces are not part of the negotiations. They will, however, remain on the back burner for two reasons. The social plan related to their closing is not completely concluded. It’s likely that ArcelorMittal will put the issue of dismantling of the furnaces, closed in the fall of 2011, on the table. “In that case we will oppose it,” warns Rader.  “It’s out of the question to remove this equipment. What if, in a few years, we see a resurgence in the demand for steel?”

BENOÎT JULY

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One Response to Mittal forces a return to the negotiating table

  1. Paul says:

    My 2 cents? No Belgian government entity (i.e. tax payer) should invest one single cent in any steel-related activities. Steel is being produced much cheaper elsewhere, the industry is dead, and all that remains to do is provide a decent burial.

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