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French govt stance may not help country’s image

Vidya Ram
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Lakshmi Mittal
Lakshmi Mittal

The French government is grappling with the fallout from controversial comments made by French Industry Minister Arnaud Montebourg, who launched a stinging attack on the Luxembourg-based ArcelorMittal, and threatened to nationalise one of its French facilities. Lakshmi N. Mittal, ArcelorMittal’s Chairman and CEO, was set to meet French President Francois Hollande in Paris, after Montebourg’s comments to Les Echos, France’s largest economic daily, in which he also suggested that Mittal was no longer welcome in the country.

The developments come ahead of a deadline on Saturday for the French government to find a buyer for two idle blast furnaces at ArcelorMittal’s Florange plant in eastern France, near the border with Luxembourg.

Unless a buyer is found by that time, ArcelorMittal plans to close the two blast furnaces at Florange that were idled last October, as European steel demand shows no sign of improvement, with the loss of 629 jobs. It plans to keep the remainder of the site, which employs a further 2,000 people, turning it into a hub for high value added products catering to the automotive industry. ArcelorMittal employs around 20,000 people in France.

ArcelorMittal isn’t the only firm to come under fire from the socialist government of Hollande, which has made protecting jobs a priority. Over the summer, Montebourg strongly criticised Peugeot Citroen for its plans to cut 8,000 jobs.

While Montebourg subsequently toned down his comments about ArcelorMittal, his aggressive stance has triggered warnings in France that it would do little for the image of a country already under fire over its attitudes towards international business. “Montebourg is giving an image of France around the world which really isn’t good,” the CEO of a major French company told the Financial Times.

Recast programme

A person close to the Mittal family expressed “shock” about the comments, adding that the company had fully lived up to the commitments it had made.

Florange had been slated for closure by the previous owners, as part of their “Apollo” restructuring programme. It is understood hat ArcelorMittal had made clear its intentions to continue with that programme but, following an uptick in steel demand (before the 2007 crisis hit), had kept the plant open.

After a brief recovery following the 2007 financial crisis, steel demand in Western Europe has slumped again, and is expected to fall around 8.5 per cent for the year 2012, according to consultancy CRU, which expects little improvement before the second quarter of 2013.

(This article was published on November 27, 2012)
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Comments:

misleading title..this doesnt make France look bad...are you suggesting a country
with the highest amount of poverty, wealth inequality, backlogged courts, and
lacking in basic infrastructure, and renowned for corruption (hmmm..India?) has a
better image?

from:  eric
Posted on: Nov 28, 2012 at 02:00 IST

Basically france is a frustrated nation. They have no capacity for
innovation.

They want to find a scapegoat for their own inabilities.

How the hell is france going to compete with china, when the french
want 35 hour work weeks when the chinese work 7 days a week and 12
hours a day.

The chinese are dumping steel on the world market.

Is mittal supposed to subidize 50 year decline of europe.

Is mittal supposed to answer for the lazyiness of the french who like
to live on laurel of the past and try to prop up there gdp by bribing
politicians in countries like india to buy the defence production of
france.

France only can make handbags and perfumes and sell it with an
arrogant price and get angry at the british and try to show they have
some standing in europe.

but france is the next greece.

bankrupt economy.

lazy workers

no innovation

socialists gone crazy, instead of making people work harder they want
to cushion them with more benefits without working hard

rascism against muslims, africans, colored people, indians, chinese
etc

france has nothing to offer the world, besides provincial contempt and
arrogance

it should become like the next gambia or mali

Do not blame mittal for your internal problems France.

Face your failure like a man.

from:  Raju Sitaramana
Posted on: Nov 28, 2012 at 04:10 IST
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