ROME, Nov. 13 -- The dispute between the Italian state and multinational steel giant ArcelorMittal continues to rage. More than 8,000 jobs in one of Italy's most economically depressed regions hang in the balance.
ArcelorMittal, the world's largest steelmaker, was approved to take over southern Italy's Ilva steelworks in June 2017, promising to pay 1.8 billion euros (2 billion U.S. dollars) for the plant while promising to spend another 2.5 billion euros to improve the plant's environmental problems and to increase production.
According to Emilio Miceli, secretary of the Filctem CGIL labor union, the deal also included a promise to maintain the plant's workforce as long as production stayed above 6 million tons of steel per year. That is well below the plant's capacity to produce 10 million tons per year, a level that makes Ilva Europe's largest steel smelter.
"The problem is, Ilva never reached production levels greater than 4 million tons since ArcelorMittal took over," Miceli told Xinhua. "That is allowing them to disregard the job guarantee."
According to Italian media, ArcelorMittal has cited the need to cut Ilva's workforce by as many as 5,000 workers as part of the reason it is no longer interested in operating Ilva, which could have added around 10 percent to the company's worldwide output of some 92 million tons of steel. The other reason stated by the company is the government's decision to lift legal immunity from prosecution for health and environmental damage caused by Ilva before ArcelorMittal took over.
Italian media reports say that Italian officials are split over whether to reverse course on the lifting of the legal immunity. But Italian Prime Minister Giuseppe Conte and other top officials have drawn a hard line in refusing to allow the job cuts.
On Tuesday, ArcelorMittal filed a suit in a Milan court to allow it to pull out of its 2017 contract. Judge Roberto Bichi assigned the case for study on Wednesday, and Local media reports say the case could open as soon as early 2020.
In the meantime, the future of the plant is cast in doubt.
Miceli told Xinhua that if ArcelorMittal pulls out for good, the state could take control of the plant under a special kind of administrative status, which was the case before ArcelorMittal took over in 2017.
But a long line of leading Italian officials including Vincenzo Boccia, head of the Confindustria industrial association and Minister of Economy and Finance Roberto Gualtieri have said that option is not a viable option.
"A nationalization of Ilva is not in the cards," Gualtieri told reporters Tuesday.
According to ABS Securities economist Oliviero Fiorini and other observers, any closure of Ilva or a significant scale-back of the company's operations could have a devastating impact on the economically depressed area around Taranto, where the plant is located.
"The Conte government is promising to turn Italy's slow-growing economy around and it certainly won't help if they add thousands of people to the unemployment rolls in Apulia (Puglia)," ABS Securities economist Oliviero Fiorini told Xinhua, referring to the Italian region that includes Taranto.
"I would guess that most topics regarding Ilva and ArcelorMittal are open to negotiations," Fiorini said. "But that laying off two-thirds of the workforce is not an idea that will get any traction with the Italian government."