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1,050 More Steel Job Losses

Monday, January 18, 2016

Further 1,050 Steel Industry Job Losses More Heart Breaking News As EU Commission Fails To Deal With Dumping Of Steel Into Europe

We are calling for a protest in Brussels on 15th February to get the Commission to deal with dumping of Chinese steel says GMB.

GMB, the union in the steel industry, commented on the announcement by Tata Steel that 1,050 jobs will be cut at Port Talbot, Trostre, Corby and Hartlepool. See notes to editors for copy of press release from Tata Steel dated 18th January and copies of GMB releases on EU and dumping Chinese steel

Dave Hulse, GMB National Officer, said "Once again this is more heart breaking news for the steel Industry and our members.

Once again this demonstrates that this government is asleep when it comes to the serious problems that we are facing.

We are seeing local communities destroyed and supply chain companies forced out of business.

This is an extremely critical time for the steel industry and our members through no fault of their own are being forced onto the dole queues while we wait for action to be taken so we are able to complete on a level playing field.

GMB once again ask this government and the EU Commission to wake up and stop talking about the problems and intervene with some positive action that gives assistance to the UK steel industry.

GMB is calling for a protest in Brussels on 15th February to get the Commission to deal with dumping of Chinese steel." See notes to editors for copies of GMB press releases on the EU and Chinese steel.

End

Contact: Dave Hulse 07971 266157 or Michael Blench 07870 176 748 Kathleen Walker Shaw in Brussels 07841 181549 or Jim Moohan, GMB Scotland on 07885 868405 or Shaune Clarkson, GMB Scunthorpe 07738 767561 or Jeff Beck in Wales on 07980 753 112 or Russell Farrington in West Midlands 07957 266519 or GMB press office 07921 289880 or 07974 251 823.

Notes to editors

1 Copy of press release from Tata Steel dated 18 January 2016

Tata Steel UK Limited announces cost reductions at its UK businesses to improve competitiveness

Tata Steel UK Limited, an indirect subsidiary of Tata Steel Limited, has today announced cost-saving proposals to improve the competitiveness of its UK business.

The plans would lead to the loss of 1,050 jobs – 750 jobs at its Port Talbot-based Strip Products UK business, 200 jobs in support functions and a further 100 jobs at steel mills in Trostre, Corby and Hartlepool.

The proposed changes follow continued falls in the European steel price caused by a flood of cheap imports, particularly from China.

A full consultation process with employee representatives will begin immediately.

Karl Koehler, Chief Executive of Tata Steel’s European operations, said: “I know this news will be unsettling for all those affected, but these tough actions are critical in the face of extremely difficult market conditions which are expected to continue for the foreseeable future.

“We need the European Commission to accelerate its response to unfairly traded imports and increase the robustness of its actions. Not doing so threatens the future of the entire European steel industry. And while we welcome progress on UK energy costs, the Government must take urgent action to increase the competitiveness of the UK for its vital steel sector. This includes lowering business rates and supporting energy efficiency and antidumping cases so we can compete fairly.

“Tata Steel has been a hugely supportive investor, and has invested £1.5 billion in its UK operations. We now need all stakeholders to do their utmost to meet the unprecedented challenges the steel sector is facing.”

Stuart Wilkie, Director of Strip Products UK, said: “We have to accelerate the changes we announced last August, by lowering our costs at the same time as focusing on manufacturing higher-value products. These are urgent steps needed to give this business a chance of survival.

“We will work closely with affected employees and their trade union representatives. Retaining the right skills for the future will be critical, but we will look to minimise employee hardship and redeploy employees where possible.”

Tata Steel’s regeneration arm UK Steel Enterprise will look at how it can provide more support to the local communities affected by today’s announcement and help stimulate new job creation in those areas. Over the last four decades the company has helped to regenerate local economies, including South Wales, with £88 million of support and created more than 75,000 new jobs across the UK.

-ends-

2 Copy of GMB press release dated 13th January

GMB TO JOIN PROTEST IN BRUSSELS ON 15TH FEB TO COINCIDE WITH EU CONFERENCE ON ON-GOING PROBLEMS IN STEEL INDUSTRY

We need action at EU level to deal with dumping of Chinese steel in the UK and the rest of Europe at below market prices says GMB

GMB, the union for steel workers, is organizing to take part in a protest in Brussels on 15th February to coincide with a special High Level stakeholders' conference in Brussels on the same day for the energy intensive industries including steel.

The conference was agreed by extraordinary meeting of the EU Competitiveness Council on 9th November 2015. It will involve the social partners to review the current situation and consider policy actions, in the context of the on-going work of the High Level Group on Energy Intensive Industries. See notes to editors for copy of GMB and EU press releases dated 9th November.

Dave Hulse, GMB National officer for the steel sector, said “GMB and the other unions in the UK are in the process of organising a demonstration on 15th February in Brussels because of the on-going problems in the steel industry.

We need action at EU level to deal with dumping of Chinese steel in the UK and the rest of Europe at below market prices. This dumping has to stop otherwise UK jobs in the steel industry will simply melt away.”

End.

3 Copy of GMB press release dated 15th January 2016

GMB SLAM EU COMMISSION FOR DUCKING DECISION ON DUMPING OF STEEL FROM CHINA AT MEETING ON 13TH JAN IN BRUSSELS

EU must put measures to prevent further dumping on EU markets as well as support for energy intensive industries that was promised at the EU Council meeting in November says GMB

GMB, the union for steel workers, commented on the discussions in the EU College of the Commission yesterday on anti-dumping and the pushing any decision back to at least summer 2016. See notes to editors for European Commission - Fact Sheet dated 13 January 2016 on College orientation debate on the treatment of China in anti-dumping investigations.

Dave Hulse, GMB National Officer, said “The EU Commission ducking the decision on Market Economy Status for China yesterday shows that deep down it knows its legal advice and policy leaning towards granting status for China is on very shaky ground.

The future of our steel, ceramics and many other industries and vital jobs in these sectors need the EU Commission to come out now with a firm “No” to China on Market Economy Status, and to start putting concrete measures behind preventing further dumping on EU markets as well as support for energy intensive industries that was promised at the EU Council meeting on November 9th 2015.

Trade unions across Europe are telling them that, the Industries are telling them that, when are they going to listen? It is time for the EU Commission to take some advice from those on the ground dealing with the chaos being caused by unfettered markets rather than those in their ivory towers who need to get out more. Save our steel and ceramics and save our jobs before it is too late.”

End

4 European Commission - Fact Sheet - Brussels, 13 January 2016

College orientation debate on the treatment of China in anti-dumping investigations

A Q&A on the College orientation debate on the treatment of China in anti-dumping investigations.

Today, the Commission had a first orientation debate on whether, and if so how, the EU should change the treatment of China in anti-dumping investigations after December 2016. The debate arises because of the expiry, in December 2016, of certain provisions in China's Protocol of Accession to the WTO. The discussion covered all implications surrounding this issue, in particular the potential impact on jobs in Europe. No decision was taken yet, and the Commission will continue developing the options for the way forward in this matter.

What are anti-dumping duties and how are they calculated?

Under World Trade Organisation (WTO) rules, the EU can impose anti-dumping duties on products from third countries if an investigation demonstrates that these products enter the EU at dumped prices that cause injury to the EU industry.

Under standard rules for normal market circumstances, dumping is calculated by comparing the export price of a product to the EU with the domestic prices or costs of the product in the exporting country.

In contrast, owing to state influence, in a non-market economy prices and costs are artificially low and hence do not reflect normal market forces. Therefore, for non-market economies, domestic prices are not used as a benchmark against which to compare export prices. Instead, WTO (and EU anti-dumping) rules allow the use of data from another market economy country – an "analogue country" - as the basis for calculation. This is referred to as the "Non-Market-Economy" methodology.

Does this mean that "Market Economy Status" is about how to calculate anti-dumping duties?

Yes. The debate about Market Economy Status for China is not about whether the country is a market economy or not - but about the method to be used to calculate dumping rates in anti-dumping investigations concerning that country after December 2016 (see below). A decision about which method is the most appropriate one for a particular country must take into account a number of aspects.

What do the existing rules say?

Under its Protocol of Accession to the WTO of 2001, China is not considered a market economy in anti-dumping proceedings. The EU anti-dumping rules contain similar provisions, and as a result use prices or costs from an “analogue country” to calculate the level of dumping of Chinese products[1]. Some provisions of the Protocol of Accession will expire in December 2016 and the Commission is currently looking at the implications.

How much trade is involved?

Currently there are 52 anti-dumping measures in force against China, covering 1.38% of EU imports from that country. The main industries concerned today are steel, mechanical engineering, chemicals and ceramics. There are presently about 250,000 jobs in industries in the EU directly covered by the measures against dumping from China.

Why does the College hold an orientation debate at this moment in time?

Certain provisions of China's Protocol of Accession to the WTO relating to this issue will expire in December 2016, and the Commission is currently looking at the implications.

A change in the status of the Chinese economy under the EU anti-dumping rules would also change the methodology of calculating anti-dumping duties which, in turn, would have an impact on the European economy. Therefore, the Commission is carefully assessing the potential impact of any change in methodology on jobs in the European Union. All relevant stakeholders - including industry - will be fully involved.

This assessment will take some time as it will cover all relevant sectors and all Member States. The objective of the orientation debate being held by the College today is, therefore, not to take a formal decision on this subject at this early stage but to have an open discussion about the way forward.

Will the position of major trade partners - like the US – influence this process?

The Commission welcomes any relevant information which can inform its assessment. Indeed, when carrying out its analysis, the Commission relies on a wide range of sources and information. The Commission intends to exchange experience and closely liaise with trade partners on this issue.

At the same time, each country's legal framework on this matter is different. The EU lists countries that are non-market economies[1] in its legislation. This is not necessarily the case for other WTO Members, like the US.

What would be the legal procedure in case of such a change of the methodology in calculating dumping rates?

Changing methods to calculate dumping margins with regard to any country would require changing the EU anti-dumping rules. This would need to be done under the standard legislative procedure where the European Parliament and the Council decide on the basis of a Commission proposal.

Is granting of Market Economy Status a unilateral or a multilateral decision in the WTO framework?

There is no common WTO definition of "Market Economy Status". How a Member grants this status to any given country depends on the Member's own internal rules and procedures. This also applies to the EU.


More information about the EU's Trade Defence policy and measures can be found on the DG Trade website, here.

[1] The other non-market economies include Vietnam, Kazakhstan, Albania, Armenia, Azerbaijan, Belarus, Georgia, North Korea, Kyrgyzstan, Moldova, Mongolia, Tajikistan, Turkmenistan, and Uzbekistan.

5 GMB press release dated Monday 9th November 2015

GMB In Brussels For Steel Rally On Monday 9th November For Action From UK And EU Governments To Save Jobs In The Steel Industry

We expect Business Secretary, Sajid Javid, and his counterparts across Europe to make some serious decisions today to tackle the major threats facing the industry says GMB

GMB, the union for steel workers, is attending a rally in Brussels on Monday 9th November to press the UK and EU governments to ‘Save our Steel’ and stop the ‘dumping’ of cheap imported steel from China and other third countries.

GMB will be joined by steel workers from the UK and other EU at the rally being held to co-incide with a special EU council of ministers that has been convened with a single item agenda – Steel. The meeting of ministers will be held at 16:30 local time until 18.30. A press conference will follow.

The details of the protest are as follows:

Assemble from 14.30 Monday 9th November,

On the corner of Rue Charlemagne/ Rue de la Loi 200,

Rally at 15.00 outside the Justus Lipsius Council Building,

175 Rue de la Loi,

Brussels

 

Dave Hulse, GMB National officer for the steel sector who is attending the rally, said “GMB calls on UK business secretary, Sajid Javid, and his European ministerial counterparts to take urgent action to stop the dumping of cheap Chinese steel, and to work on support measures regarding other issues putting major pressures on the sector.

The UK government has been slow to act in offering concrete support for the country’s crisis hit steel industry, which has been battered by cheap Chinese steel imports where steel prices have collapsed in recent months. The sector is also suffering from the effects of energy prices and the ETS (Emissions trading system) which impacts heavily on the industry.

We expect Business Secretary, Sajid Javid, and his counterparts across Europe to make some serious decisions today to tackle the major threats facing the industry in  the UK and Europe. We want to see specific measures to help level the playing field, including:

- increasing the speed and effectiveness of implementing trade defense measures to respond to price crashes in third countries,

- considering measures to support the industry in relation to the revision of the ETS and rules on carbon leakage,

- assess the impact of energy tariffs and how the negative impact can be remedied,

- a block on granting market economy status to China whilst they continue to dump steel on EU markets, and for a full social and economic impact assessment on the question of granting this status to China to be undertaken.

Sajid Javid cannot come back from this meeting empty handed – and if he does then he will need to have a cracking plan B.  GMB hopes he will learn from other EU countries such as Germany and Italy who have supported the steel sector more actively, as part of a practical industrial strategy, and come back prepared to do the same.

Ministers must recognise that the UK and wider EU steel industry is competitive and productive, and has a highly skilled and experienced workforce that deserves to be supported and protected. They have to put in place the measures to allow us to compete on a level playing field. We can’t do that with our hands tied behind our back.

Ministers must act now to stop the dumping of cheap Chinese steel, help with high energy and emissions costs and Save Our Steel.”

End

6 Press release from the EU dated 9th November 2015

Competitiveness Council on the European steel industry - Presidency conclusions

Council of the EU

The Council (Competitiveness) took stock of the serious challenges faced currently by the European Steel industry.

The EU steel sector suffers from major global overcapacity in production, which pushes down prices and encourages trade distorting behaviour from competing regions. High energy costs are eroding margins. And the resulting closure of steel plants is costing thousands of jobs.

The Council agreed on the gravity of the situation as well as on the need to take concrete actions that will help ensure the long-term viability of a modern European steel sector.

The Council also considered that these measures should be part of a comprehensive approach aiming at creating competitive framework conditions for EU industry as a whole, including through a predictable and consistent regulatory environment as well as measures to stimulate innovation, since many of the issues faced by the steel sector are shared by other energy intensive industries.

Taking into account the results of the Council discussion, the Presidency considers that the following concrete actions should be taken as a matter of priority:

·    To intensify or launch discussions involving all important steel producers in the context of the OECD Steel Committee and through the Commission's bilateral steel dialogues with third countries like China, Russia, Belarus, Turkey and India.

·    To make full and timely use of the full range of EU trade policy instruments to ensure a global level playing field and to address restrictive measures in third countries in particular as regards the steel sector.

·    To take a constructive approach when it comes to the modernisation of Trade Defense Instruments that further streamline and expedite their operation, increase transparency, predictability, effectiveness and enforcement.

·    To further improve access for the EU steel industry to third markets, including through public procurement, through bilateral and multilateral negotiations and implementation.

·    To make full use of the Investment Plan for Europe to upgrade and modernise the steel sector through use of the European Investment Advisory Hub and the European Fund for Strategic Investments.

·    To make best use of the possibilities given under the revised State Aid rules to support Energy Intensive Industries in R&D&I, training, environment, employment and ETS costs.

·    To improve the competitiveness of sectors most at risk of carbon leakage, including the steel industry, by considering, as part of the reform of the European emissions trading system (“EU ETS”):
- a more focused mechanism for free allocation of allowances, for example through a tiered approach;
- elements to minimise the need for a cross-sectoral correction factor by the end of ETS phase IV, while creating the right incentives for industrial innovation and enhancing the possibility to increase production levels, in line with the conclusions of the October 2014 European Council.

·    To support the swift implementation of the European Energy Union to ensure access to secure, affordable and climate-friendly energy.

·    To fully exploit the possibilities under the forthcoming Communication on the Circular Economy.

·    To make best use of the available EU instruments and funding, such as the European Globalisation Adjustment Fund and the European Social Fund, for upskilling workers and facilitate their re-integration into the labour market in case of mass redundancies in any industrial sector, including the steel industry.

To follow up on this extraordinary meeting of the Competitiveness Council, it has been agreed to call for a special High Level stakeholders' conference, involving the social partners, to review the current situation and consider policy actions, in the context of the ongoing work of the High Level Group on Energy Intensive Industries.

The implementation of the 2013 European Steel Action Plan should be assessed in the context of that meeting.

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