EU urges ArcelorMittal to suspend closures

(BRUSSELS) - The EU executive on Tuesday said it had asked ArcelorMittal to suspend the closure of sites in Europe pending the launch of a pan-Europe plan to save the industry -- but the global steel giant declined.

Speaking at a European Union roundtable on steel, the EU's industry commissioner Antonio Tajani said: "We want ArcelorMittal to postpone its decision to close sites at least until the EU releases its action plan."

Tajani, who chaired the third meeting in less than a year on how to improve the industry's competitiveness, said he was convinced Europe could save its steel sector and had sent ArcelorMittal a request to postpone closures pending release of an EU plan "by the summer." The letter was not immediately available.

But Belgian and French ministers at the talks said the world's top steel producer rejected the request. "ArcelorMittal did not reply positively," said Belgium's Jean-Claude Marcourt.

The company said separately that it was impossible to halt its restructuring plans because of the "extremely fragile economic situation in Europe which is pushing down steel demand.

"If we do not take action ... we will only weaken the company in Europe, threatening the viability of other sites," it said in a statement.

"Such decisions are difficult to make and we understand that they are equally hard to understand for those involved but we have to run the company in the interests of all 98,000 employees across Europe."

The steel group's decision to close plants in Belgium, Luxembourg and France has triggered violent protests as well as moves by EU nations to band together to save an industry that was at the heart of the creation of the bloc.

"There can be no Europe without steel-making," Tajani said at the opening of talks attended by 13 nations, many at ministerial level, as well as trade unions and industry delegates.

He said steel-making must be maintained in Europe not only to save jobs but also to contribute to the green economy in sectors such as clean energy vehicles, renewable energy and recycling facilities.

The steel sector accounts for some 360,000 jobs at about 500 plants in the EU, but production slumped from 22 precent of world output to 12 percent between 2001 and 2011.

Attending the talks were ministers Jean-Claude Marcourt from Belgium, Arnaud Montebourg from France and Etienne Schneider from Luxembourg.

ArcelorMittal is shutting down six cold-processing facilities in the Liege region of eastern Belgium, blaming weak demand for cars and cutbacks in auto plants for the fall in demand for steel. Some 1,300 jobs are at stake.

The company is also embroiled in controversy in France over the closure of blast furnaces at Florange, and in Luxembourg has temporarily closed a blast furnace at Schifflange and cut production at Rodange.

ArcelorMittal is the leading supplier of steel products in all major markets including automotive, construction, household appliances and packaging. It operates in 60 countries and employs about 260,000 people worldwide.