Chinese steelworkers' protest halts plant's takeover, privatization

A similar protest last month in the northeast led to the general manager of a state-owned steel plant being beaten to death.

By
August 17, 2009 10:51

China on Sunday called off the takeover of a state-owned steel plant after workers protested and trapped an official in the factory office for four days - the second time in a month that the country's steelworkers have rallied to successfully avoid privatization. Authorities in central Henan province decided to stop the takeover of Linzhou Iron and Steel Co. Ltd. to calm workers who had protested since Tuesday against the restructuring and to demand higher compensation, the official Xinhua News Agency said. A similar protest last month in the northeast led to the general manager of a state-owned steel plant being beaten to death. That plant's merger was called off as well. Beijing is trying to streamline China's sprawling steel industry, the world's largest, by orchestrating a series of mergers aimed at creating globally competitive producers. The mergers, however, often come with layoffs and complaints that workers get too little severance pay. The Linzhou plant was sold last month to Fengbao Iron & Steel Co. Ltd., located only a kilometer away, Xinhua said. Massive layoffs followed, and workers were to get just 1,090 yuan ($159) for each year of service, the report said.


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