Did being part of the EU protect them from the Financial Crisis

Turmoil Spurs US Plant Closures, EU Layoffs At ArcelorMittal

December 10th, 2008

By Alex MacDonald

In a sign of the severity of the economic downturn, ArcelorMittal (MT), the world’s largest steelmaker, announced plans to close two U.S. steel processing plants and lay off several hundred workers in the European Union.

ArcelorMittal plans to close its finished steel processing plant in Lackawanna, N.Y., by the end of April and plans to close its finished steel processing plant in Hennepin, Ill., sometime in the future, although no date was disclosed. The two closures will result in 545 job losses, 260 of which are located at the N.Y. plant and 285 of which are located at the Illinois plant.

Meanwhile, ArcelorMittal rolled out voluntary redundancy programs in Europe over the past week or so that would eliminate 3,550 mostly white-collar jobs through voluntary layoffs. The company is eyeing 6,000 job cuts in Europe out of 9,000 job cuts globally.

The closures and layoffs are in line with the company’s plans to cut 35% of its global steel production capacity during the fourth quarter and saving $1 billion annually by cutting 3% of its global workforce.

Both steel plants supply the auto market, where demand has slumped so dramatically that the U.S.’s three largest car manufacturers are now seeking federal government funds to avert bankruptcy.

The closures are part of ArcelorMittal’s global restructuring program to weather the economic downturn.

The decision to close ArcelorMittal Lackawanna was “purely an economic business decision based on the extraordinary economic conditions we face today,” the company said in a statement.

The Lackawanna plant has inherent disadvantages due to its location that lead to higher costs, longer customer lead times, and higher inventory levels than other ArcelorMittal finishing facilities in the US, the company said.

Meanwhile, at Hennepin, “the company had to make the tough decision to close the…facility, consolidate operations and move production to other ArcelorMittal facilities in the U.S.” in order to remain competitive.

ArcelorMittal now has announced plans to lay off 19% of its U.S. salaried workforce of 15,543 people and has announced more than half of its planned job cuts in Europe.

The United Steelworkers union and other relevant stakeholders were notified about the plant closures and job layoffs. They are now negotiating with the Luxembourg-based company to arrive at a compromise.

Jim Robinson, the director of USW’s District 7 said the union was aware that ArcelorMittal faced operational issues at the two plants but was surprised by the company’s decision to close the plants.

“They called us before they announced but we did not know this specifically” beforehand, he said.

Robinson dismissed views that ArcelorMittal has underinvested in the plants. “I don’t think the issue is lack of investment over time, I think it’s an issue of the company’s overall strategy.” He declined to elaborate further.

ArcelorMittal is one of many steelmakers globally that have announced production cuts and layoffs. U.S. Steel Corporation (X), the world’s tenth-largest steelmaker by volume, announced last week it would temporarily idle an iron ore mining facility and two steel works. The move will affect 3,500 employees.

Corus, Europe’s second largest steelmaker by volume and the European arm of India-based Tata Steel Ltd (500470.BY) has cut production by 30% and has shed about 500 jobs from the U.K.

In Europe, ArcelorMittal is seeking voluntary redundancies equal to 1,400 jobs in France, 800 in Belgium, 750 in Germany, and 600 in Spain. Most of them are white collar jobs. ArcelorMittal’s American depositary shares recently traded up 8.9% to $25.99 on the New York Stock Exchange.

Company Web site: http://www.arcelormittal.com

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EU businesses expect 1 million job losses in 2009

Brussels – European Union businesses called Monday for a cut in interest rates amid predictions that the bloc’s economic slowdown could lead to more than 1 million jobs being lost in 2009.

BusinessEurope, which groups national business federations from 34 European countries, also called on governments to ensure a continued flow of credit and to approve structural reforms aimed at improving the continent’s competitiveness.

According to its latest Economic Outlook, EU gross domestic product (GDP) is predicted to grow by just 0.4 per cent in 2009, compared to 1.4 per cent this year, with exports, imports and private consumption levels all slowing.

Unemployment is predicted to increase from 7 per cent to 7.8 per cent, with the loss of 1.1 million jobs, compared to a net job creation of more than 2 million in 2008.

“The most fundamental preoccupation of the business community is obviously the way in which the impact of the financial market turmoil will play out,” the paper said.

“Even though a fully-fledged credit crunch has not yet appeared in Europe, uncertainty about the impact for companies and consumer markets has increased tremendously.”

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SEMI Europe calls for investment to avoid mass job losses in semiconductor industry

December 10 2008

During the third SEMI Brussels forum, SEMI Europe declared that the decline in the European semiconductor industry could potentially put half a million European jobs at risk. SEMI Europe presented its White Paper to EU officials and urgently appealed for the EU and national policymakers to invest to support the European semiconductor industry citing the industries importance to the health and global competitiveness of the EU economy.

The equipment/materials producers and the semiconductor device manufacturers contribute around €29 billion to the EU economy and provide around 215,000 jobs. The European semiconductor industry is also a significant contributor to the GDP in EU countries such as France, Germany, Ireland, the Netherlands and the UK.

“If semiconductor manufacturers leave Europe, indigenous equipment & materials producers will face an uncertain future”, said Franz Richter, Chairman of the SEMI European Advisory Board. “The current economic crisis and rising unemployment underscore the urgent need to safeguard jobs in the European semiconductor industry. Supporting a robust and competitive semiconductor industry in Europe is critical to keeping jobs in Europe across all industries and supporting key European economies.”

The decline of the market share even during the increase in total volumes sold reflects that manufacturing is changing and moving away from Europe because of the unfavourable global level playing field conditions. The European equipment and materials manufacturers that supply the semiconductor industry with machinery and parts are for the most part small or medium-sized European businesses that heavily rely on the future European semiconductor industry to guarantee their own future and the 105,000 jobs they embody.

Further information on the Brussels forum is available here.

Source

Spanish auto sector highly exposed to global crisis

December 11 2008

By Robert Hetz

MADRID,

Spain’s car industry, which became Europe’s third largest, thanks to a cheap workforce, has lost cost advantage and could shrink as companies slash costs at foreign plants and save politically-sensitive jobs at home.

As executives at multinational manufacturers weigh up Spain’s ageing factories, relatively high wage costs and weak competitiveness against their own domestic markets and cheaper alternatives, the country’s plants are clear targets as the credit crunch saps demand all over the world.

“The big decisions are being taken abroad, not here, and managers in London, Paris and Detroit prefer to close a plant here and not in their home market,” said the director of one Spanish parts plant, who asked not to be named.

Unlike Germany, France or Italy, Spain’s auto industry has no nationally-owned car maker and little control over decisions on the future of its 18 foreign-owned plants, which employ around 70,000 people.

And unlike the case of Britain, Spain’s plants are older and less productive, and the country lacks a more skilled workforce or much tradition of home-grown research and development.

Global car makers, also including Peugeot, Opel and Volkswagen, built most of their Spanish plants in the 1970s when Spain was a low-cost backwater, well placed to serve Northern European markets.

Since the 70s, Spain has lost its price advantage as living standards have caught up with the European average. In 2007, per capita income overtook that of Italy. At the same time, new competitors have emerged as low-cost manufacturing centres.

Spain’s auto-sector salaries averaged 22.83 euros ($29.64) an hour last year, above the European average and around three times the 6.93 euros in Poland and 8.83 euros in the Czech Republic, Europe’s new manufacturing hubs, alongside North Africa.

NORTH AFRICA PASSES SPAIN FOR RENAULT

Renault plans to make 200,000 cars at its plants in North Africa in 2010 and double that within a couple of years, overtaking production from its Spanish operations.

The global credit crunch has hurt demand for new cars across Europe, with new car registrations in November falling 36.8 percent in the UK, 18 percent in Germany, 30 percent in Italy and 50 percent in Spain.

With some 84 percent of cars built in Spanish plants for export, manufacturers are finding fewer financial or political reasons for remaining in the country as international competition rises.

Spanish plants are ideal candidates for the inevitable cuts across Europe, head of Ford Espana Jose Manuel Machado said, as salaries rise and productivity fails to rise at a similar rate.

Machado’s comments came before the U.S. company announced production cuts of 120,000 units at its Almussafes plant in Valencia, and the temporary layoff of 5,200 workers.

Job cuts are expected from most of the major manufacturers, with more than 60 filings listing potential layoffs by private companies made to the government, which may affect up to 40,000 workers, Spain’s main union UGT said.

As Spain’s unemployment rate soars to the highest in the European Union and the economy nears recession, the government is keen to keep the industry, which accounts for around 5 percent of gross domestic product, in the country.

Spain has earmarked 800 million euros for the sector as part of measures worth a total of around 50 billion euros to stimulate the economy.

But this aid may not be enough.

“It’s a good gesture from the government, but obviously the amount of money is insufficient. It would be less than 80 million euros per manufacturer,” said Jose Antonio Bueno of consultancy Europraxis.

The sharp fall in new car sales in Spain has also affected the manufacturers’ showrooms and spare parts centres throughout the country.

Concessions for new and second-hand cars and garages employ around 278,000 people in Spain, and 16,000 of those jobs are at risk, the association for the sector, Ganvam, estimates.

“Four years ago we sold two or three cars a day, but now its not even two a week,” said Adela Benito, who has worked in a Madrid-based Renault showroom for 20 years. (Reporting by Robert Hetz; Additional reporting by Tomas Gonzalez; Writing by Paul Day; Editing by Rupert Winchester)

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Swedes want government bailout for Volvo

In a new survey just released, 68 percent of Swedes want to see the Swedish government bail out its beleaguered carmaker Volvo. Although Volvo is owned by US carmaker Ford, Swedes would like its government to temporarily take control of the nation’s iconic firm, as many residents fear Volvo may disappear entirely from Sweden in the near future.

The Local newspaper reports that support for government intervention is piling in from all sides of the political arena. Some 65 percent of those polled who support the bailout side with one of the governing Alliance parties, and 73 percent of all left bloc voters approve of a government bailout.

Peter Larsson of the Swedish Association of Graduate Engineers points out that Volvo’s current crisis is not minor. “One thing is certain, there are no dollars on their way over the Atlantic,” Larsson said, referring to the massive problems currently faced by the “Big Three” US carmakers – Ford, Chrysler, and (Saab-owner) General Motors.

Rolf Wolff, dean of the school of business at Gothenburg University, told The Local: “If Volvo Cars disappears as a base for industrial knowledge and skills, then Sweden will never again be a part of the auto industry. All the knowledge and skills would be lost, and with it all future associated development potential would be gone.”

Maud Olofsson, Sweden’s minister of trade and industry, has expressed doubts whether the government would be able to better manage Volvo than the car firm itself. For now, the issue has been placed on the political back burner, but the crisis at Volvo and Ford goes on.

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This is just the tip of the iceburg.  Seems no one is safe from the Financial Crisis. Not even EU members.

There are 27 member of the European Union.

austria 1. Austria
belgium 2. Belgium
UK 3. UK
denmark 4. Denmark
germany 5. Germany
greece 6. Greece
ireland 7. Ireland
spain 8. Spain
italy 9. Italy
luxembourg 10. Luxembourg
netherlands 11. Netherlands
portugal 12. Portugal
finland 13. Finland
france 14. France
sweden 15. Sweden
cyprus 16. Cyprus
czech 17. Czech Republic
estonia 18. Estonia
hungary 19. Hungary
latvia 20. Latvia
lithuania 21. Lithuania
malta 22. Malta
poland 23. Poland
slovakia 24. Slovakia
slovenia 25. Slovenia
bulgaria 26. Bulgaria
romania 27. Romania

EU members and when they joined.

1952 Belgium, France, Germany, Italy, Luxembourg, Netherlands

1973 Denmark, Ireland, United Kingdom

1981 Greece

1986 Portugal, Spain

1995 Austria, Finland, Sweden

2004 Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, Slovenia

2007 Bulgaria, Romania

Source

Hungary’s Letter of Intent to the IMF

World Bank lends to Bulgaria to tackle poverty, jobless

Latvia mulling IMF loan as crisis sweeps Nordic region

EU, Iceland, Canada Suffering Fall Out, Caused By US Crisis

Europeans Angry at their Money being Used for Bailouts

The £2trillion question for British economy

Europe catches America’s financial disease

How Britain’s banks will never be the same again

Economist, deregulation and loose fiscal policies lead to Meltdown

World Leaders Must Roll Back Radical WTO Financial Service Deregulation

Ryanair to appeal EU’s ‘corrupt’ support of Alitalia takeover

Ashley Mote Revealing European Union Corruption

The EU budget is necessarily corrupt

EU leaders tear up rules of Eurozone

Starting to remind me of the Corruption in the US where the Crisis started.

Save the Children Donates To Zimbabwe Crisis

December 3 2008
Save the Children New Zealand has announced that it will be sending NZD $60,000 to support the humanitarian crisis in Zimbabwe.

Following on from the disputed election run-offs between Robert Mugabe and Morgan Tsvangirai, Zimbabwe has been in a worsening state of decline.

10 million people, out of a population of 13 million live below the poverty line. Up to 5.1 million people will be in need of food aid to survive by the end of the year. One in 10 children in Zimbabwe die before the age of five, although with rocketing rates of malnutrition and disease, the child mortality rate will also rise.

A deadly outbreak of anthrax is threatening to wipe out at least 60,000 livestock in Zimbabwe’s northern Zambezi Valley. 32 cases of human anthrax have been reported in the Binga district. This figure is expected to rise.

On top of the anthrax outbreak comes reports of increasing cholera infections which have already killed hundreds of people. Zimbabwe is also in the midst of an economic crisis due to hyperinflation. On 14 November 2008 the Cato Institute released a document estimating that Zimbabwe’s monthly inflation rate to be 79.6 billion percent. This is equivalent to prices doubling every 24 hours.

Save the Children launched a global appeal on 1 December 2008 to raise money for the humanitarian crisis in Zimbabwe. With increased resources, Save the Children’s emergency team will be responding to the anthrax and cholera outbreaks by helping to vaccinate cows from anthrax, training health workers, providing food so that safe treatment camps can be set up, and educating communities how to avoid infection.

As well as setting up food programmes the aid organisation is also helping families prepare for the future by distributing seeds, small livestock and helping to set up vegetable gardens.

Philip Abraham, Acting Executive Director for Save the Children New Zealand says: “The humanitarian situation in Zimbabwe has reached unprecedented proportions which is why Save the Children has launched a global appeal for donations. We have been working in Zimbabwe for 25 years and have expertise in operating effective programmes within the country. We know we can save lives; we just need the resources to do it”.

To make a donation to support Save the Children’s work in Zimbabwe please: Visit www.savethechildren.org.nz or call our donation line 0800 167 168

Source

Zimbabwe has reached unprecedented proportions.

A deadly outbreak of anthrax has been reported in the north of Zimbabwe, with three people and more than 160 cattle already dead.

British charity Save the Children says that, coming on top of the ongoing cholera epidemic and the desperate food shortage, the humanitarian crisis in Zimbabwe has reached unprecedented proportions.

“Many families in the Zambezi valley are so hungry that they are taking meat from the carcasses of their dead animals, even if they know it’s diseased, and are feeding it to their children,” said Save the Children’s country director, Rachel Pounds. “If the animal has been poisoned by anthrax, those children could die.”

A quarantine zone has been declared in the affected areas of Matebeleland North. But traders have been seen taking potentially infected carcasses out of the restricted zones to trade in the Victoria Falls region. This risks the disease spreading across Zimbabwe and into Zambia.

Zimbabwe has had problems with Anthrax in the past, having experienced the worst-ever recorded outbreak of the disease in 1979/80, at the time of its civil war. More than 10,000 human cases were recorded and 182 human deaths. Some have suggested, but not proved, that biological warfare was involved.

Little anthrax vaccination has taken place in Zimbabwe during the past five years and the strain now found in the Zambezi valley has been identified as particularly virulent.

Anthrax can kill when infected meat is touched or eaten, or when infected spores are inhaled.

Save the Children has launched a big appeal for funds, which will be used to help vaccinate cattle and educate people about the dangers of anthrax.  In the UK For more information and to donate, click here

Source

Zimbabwe runs out of water-Public desperation is increasing

Barack Obama reveals two-year plan to create 2.5m jobs

November 22 2008
By Matthew Weaver

Barack Obama has outlined his plan to create 2.5m jobs in his first two years in office with an ambitious spending programme on roads, schools and and renewable energy.

In his weekly internet address the United States president-elect warned that the US was “facing an economic crisis of historic proportions”.

But he suggested he was keen to launch a major two-year spending programme, to “jumpstart job-creation in America and lay the foundation for a strong and growing economy”. He pledged the programme would create 2.5 million jobs by January 2011.

That goal has led to speculation that Obama will try to launch a spending package larger than the $175bn (£118bn) plan he outlined in his election campaign.

Obama said details of the programme were being worked out by his transition team.

“We will put people back to work rebuilding our crumbling roads and bridges, modernising schools that are failing our children, and building wind farms and solar panels and fuel efficient cars and the alternative energy technologies that can free us from our dependence on foreign oil,” he said.

Both Republican and Democrat support would be needed to get the programme approved, he said, but “what is not negotiable is the need for immediate action”.

Noting the turmoil on Wall Street, a drop in house sales, rising unemployment and the threat of deflation, he said: “There are no quick or easy fixes to this crisis, which has been many years in the making, and it’s likely to get worse before it gets better.”

But Obama said his inauguration day on January 20 “is our chance to begin anew”.

“We must do more to put people back to work, and get our economy moving again.

“There are Americans showing up to work in the morning only to have cleared out their desks by the afternoon. These Americans need help and they need it now.”

Wall Street ended a volatile week with renewed confidence last night, after reports that Obama had chosen Timothy Geithner, the head of the New York Federal Reserve, as his treasury secretary.

The Dow Jones industrial average recorded a 494-point gain on the day as stocks surged by 6.5% to close above the psychologically important 8,000 level at 8046.42. It was still 5% down for the week, however, as worries persisted about the global economic slowdown.

Geithner, 47, has always been a favourite to take the top job and his appointment was expected to be announced by the Obama camp this weekend.

Source

This plan is a far cry better then tax cuts which have been used for years.

This a direct approach to the problem. It will boost the economy on many fronts. The more people working the more spending.

What it may cost, is saved by less people being on welfare or unemployment.

Their will also be saveings in the health care department as well.

Less people beoming homeless as well.

This plan puts money into the peoples pockets.

This plan could very well, in the end pay for itself.

Tax cuts do little or nothing to boost the econonmy.

Corporations just buy yet another jet or give their CEO’s a raise in pay.

Obviously that hasen’t worked all that well.

Seems they are more prone to killing jobs as we have seen in the recent past.

Obama’s will work. Renewable energy is an extrememly fabulous way to go.

Certainly better then going to war to secure Oil for example from another country.

Which by the way leave a massive foot print of pollution behind.

Renewable clean energy will also play a great part in preventing pollution.

Pollution is something America has not addressed with open arms. They were put in a state of fear that it was a bad thing and would destroy jobs.

Of course we full well know this was propaganda by profiteering, Corporations that pollute. They just don’t want to clean up their act.

They put profit before the environment.

Pollution kills.

Investing in children’s education is beneficial to  everyone. They are the future generation who will someday be the caretakers of the planet.  Giving them the tools they need is a wise move.

Each child has a gift to give to the world. Each child deserves a fair and equal chance to foster their gift.

In Pakistan -Sherpao seeks parliamentary debate on IMF loan issue

November 10 2008

PESHAWAR: Pakistan People’s Party-Sherpao (PPP-S) Chairman Aftab Ahmed Khan Sherpao said on Sunday that International Monetary Fund (IMF) loan issue should be debated at length in Parliament before taking loan from the IMF.

Addressing a press conference at his Peshawar residence after a party meeting, Sherpao said that economic crisis had further worsened due to deteriorating law and order situation in the country, necessitating an in-depth discussion in Parliament on the IMF loan before the government took a final decision on taking loan from the IMF.

The PPP-S leader said Pakistan should give a befitting replying to those attacking sovereignty, integrity and solidarity of the country. Sherpao demanded that 14-point resolution passed by Parliament after a joint in-camera session should be implemented.

Though the whole world is facing financial crisis, Pakistan is suffering from the worst one than other countries, Sherpao said.

He said that he was not invited to Pak-Afghan Jirga held recently in Islamabad. However, he added, such jirgas were useful for both the countries. He said more jirgas should be held to restore peace in the region.

Earlier, the PPP-S meeting condemned US missile attacks on the Pakistani territory, including Waziristan. staff report

Source

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Real Change Depends on Stopping the Bailout Profiteers

To understand the meaning of the U.S. election results, it is worth looking back to the moment when everything changed for the Obama campaign. It was, without question, the moment when the economic crisis hit Wall Street.

Up to that point, things weren’t looking all that good for Barack Obama. The Democratic National Convention barely delivered a bump, while the appointment of Sarah Palin seemed to have shifted the momentum decisively over to John McCain.

Then, Fannie Mae and Freddie Mac failed, followed by insurance giant AIG, then Lehman Brothers. It was in this moment of economic vertigo that Obama found a new language. With tremendous clarity, he turned his campaign into a referendum into the deregulation and trickle down policies that have dominated mainstream economic discourse since Ronald Reagan. He said his opponent represented more of the same while he stood for a new direction, one that would rebuild the economy from the ground up, rather than the top down. Obama stayed on this message for the rest of the campaign and, as we just saw, it worked.

The question now is whether Obama will have the courage to take the ideas that won him this election and turn them into policy. Or, alternately, whether he will use the financial crisis to rationalize a move to what pundits call “the middle” (if there is one thing this election has proved, it is that the real middle is far to the left of its previously advertised address). Predictably, Obama is already coming under enormous pressure to break his election promises, particularly those relating to raising taxes on the wealthy and imposing real environmental regulations on polluters. All day on the business networks, we hear that, in light of the economic crisis, corporations need lower taxes, and fewer regulations — in other words, more of the same.

The new president’s only hope of resisting this campaign being waged by the elites is if the remarkable grassroots movement that carried him to victory can somehow stay energized, networked, mobilized — and most of all, critical. Now that the election has been won, this movement’s new missions should be clear: loudly holding Obama to his campaign promises, and letting the Democrats know that there will be consequences for betrayal.

The first order of business — and one that cannot wait until inauguration — must be halting the robbery-in-progress known as the “economic bailout.” I have spent the past month examining the loopholes and conflicts of interest embedded in the U.S. Treasury Department’s plans. The results of that research can be found in a just published feature article in Rolling Stone, The Bailout Profiteers, as well as my most recent Nation column, Bush’s Final Pillage.

Both these pieces argue that the $700-billion “rescue plan” should be regarded as the Bush Administration’s final heist. Not only does it transfer billions of dollars of public wealth into the hands of politically connected corporations (a Bush specialty), but it passes on such an enormous debt burden to the next administration that it will make real investments in green infrastructure and universal health care close to impossible. If this final looting is not stopped (and yes, there is still time), we can forget about Obama making good on the more progressive aspects of his campaign platform, let alone the hope that he will offer the country some kind of grand Green New Deal.

Readers of The Shock Doctrine know that terrible thefts have a habit of taking place during periods of dramatic political transition. When societies are changing quickly, the media and the people are naturally focused on big “P” politics — who gets the top appointments, what was said in the most recent speech. Meanwhile, safe from public scrutiny, far reaching pro-corporate policies are locked into place, dramatically restricting future possibilities for real change.

It’s not too late to halt the robbery in progress, but it cannot wait until inauguration. Several great initiatives to shift the nature of the bailout are already underway, including http://bailoutmainstreet.com. I added my name to the “Call to Action: Time for a 21st Century Green America” and invite you to do the same.

Stopping the bailout profiteers is about more than money. It is about democracy. Specifically, it is about whether Americans will be able to afford the change they have just voted for so conclusively.

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Published in: on November 8, 2008 at 4:42 am  Comments Off on Real Change Depends on Stopping the Bailout Profiteers  
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