Steelworkers put pressure on Bonn

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The Independent Online
UNION leaders called yesterday for protest demonstrations in Bonn next month to remind the government of its 'national responsibility' for the crisis facing Germany's steel industry.

Franz Steinkuhler, leader of IG-Metall, the steel and engineering workers' union, said that the question at issue was whether 'the German steel industry itself can be secured for the future'. Mr Steinkuhler was speaking in Duisdorf, in the Ruhr industrial region of western Germany, during emergency discussions in connection with the crisis.

In the east German region of Saxony, meanwhile, IG-Metall called for a demonstration of metal-workers today in Chemnitz - formerly Karl-Marx-Stadt. The union expects a rally to be attended by 20,000 people.

The protests in west and east are to some extent over different issues. Those in the west are fighting for their jobs, while those in the east are, at least in part, fighting for pay. Perhaps as many as 40,000 German jobs are expected to be lost as Europe faces its biggest steel crisis for years. There is European over-capacity of around 30 million tons, of which one- quarter comes from Germany. Cheap steel from Eastern Europe and the former Soviet Union has flooded the market while demand has already decreased. Prices have fallen by around 40 per cent.

Most of this has taken the industry by surprise - 'like an earthquake', in the words of Der Spiegel magazine, which said: 'The long boom lasting for almost eight years made them carefree. Until the end of last year, output and earnings were excellent.'

This is one of the few areas where the west seems likely to suffer more - at least in terms of job losses - than the east. At present, the east German workers are cheaper than their west German counterparts - though not as cheap as their former Comecon comrades in Poland and in the Czech and Slovak republics. The east Germans can thus hope to hang on to their jobs for the moment.

But disputes over wage parity have led to considerable bitterness. In 1991, full wage parity in the east was promised by 1994. But the employers are not keen to go ahead. IG-Metall is now threatening industrial action within the next few weeks against any company that looks ready to break the deal.

Meanwhile, agreement between government and opposition on a planned 'solidarity pact' - the financing of recovery in the east, through austerity in the west - seem as distant as ever. The general secretary of the ruling Christian Democrats, Peter Hintze, said that he was pessimistic about the talks, which have been billed as the 'final' round - on 10 and 11 March - following counter- proposals this week by the opposition Social Democrats (SPD) for higher taxes.

Mr Hintze said yesterday: 'The SPD's proposals make one fear the worst.' The leader of the Free Democrats, Otto Lambsdorff, said that the Social Democrats' proposals would be a 'nail in the coffin of recovery and growth in the east'. The SPD, in turn, is unhappy at proposals for a wide range of cuts in social benefits, as suggested by the government.