Not without other economic strengths, such as being the largest Romanian river port and a university city, or its position next to the Moldovan and Ukrainian borders, Galati has been revolving for decades around its steelworks, in turn the largest in the country.
Opened in 1966, the plant had over 50,000 employees six years later. A 2011 survey showed that two-thirds of the population of Galati had worked or were still working in the mill or in its related plants. The city and county’s star football team itself, a champion of Romania 14 years ago, is called “Oţelul” (“Steel”).
After the collapse of the communist dictatorship, the plant was privatised. Today it is owned by Liberty House Group, founded by the Indian-born British businessman Sanjeev Gupta. And it is now feeling the full impact of the general crisis in the energy-intensive European industry.
On Wednesday, dozens of Liberty Galati employees protested over delays in the payment of salaries and other rights. The plant has been out of work for 9 months, and its management obtained court approval for a settlement procedure which allows for a 4-month postponement of the payment of creditors’ claims.
For the time being, the Galati steelworkers are not considering an all-out strike, and say they are still waiting for clarifications from the management. The Social-Democratic MEP Dan Nica, who has been living in Galaţi for 40 years, warns against the danger of the plant closing, which would leave thousands of families without incomes:
Dan Nica: “The European industry is in the worst situation it has ever been. The Galaţi plant is in great danger of ceasing its operations, and tens of thousands of people may be losing their jobs. The same is true for the aluminium industry, the same is true for the cement industry, the chemical fertiliser industry, because we failed to take appropriate measures: high energy prices, imports from countries outside the European Union that are made with high carbon dioxide emissions and that have invaded the European Union market, the lack of financing from any source, EU programmes, the European Investment Bank that refuses to finance all these programmes.”
In addition, experts say, the increase in American duties on steel imports will severely impact the EU steel industry and implicitly Romania. The MEP Iuliu Winkler (Democratic Union of Ethnic Hungarians in Romania:
Iuliu Winkler: “This means adding an extra 25% to the costs, so it actually comes to deepen the crisis affecting the steel industry in both the European Union and Romania, because it is a crisis generated, first and foremost, by the price of energy. Energy is about 3 times more expensive in Europe than in the United States and that destroys the whole concept of European competitiveness.”
In terms of volume, Romania is the third-largest European steel exporter to the United States and, together with Germany, the main aluminium exporter. (AMP)
