The board of directors of the Huachipato Steel Company, of Talcahuano, reported that it made the “painful” decision to “indefinitely” suspend steel operations, in the context of the crisis faced by the plant due to the import of Chinese steel, which is marketed under market values and that it is up to 40% cheaper than the Chilean product.
Although the company appreciated that the Anti-Distortion Commission has identified the existence of irregularities in steel imports from China and that it decided to apply tariff surcharges, “unfortunately, the defined rates are lower than those requested by the Company and, furthermore, differentiated by producer and exporter, which prevents the company from competing on equal terms.”
Huachipato generates, until now, 20 thousand direct and indirect jobs.
Reactions
The regional governor of Biobío, Rodrigo Díaz, expressed his “deep disappointment and concern” at what he considers a failure of the Government to protect one of the most emblematic industries of Biobío. “The truth was always told to the Ministry of Economy. The need to implement adequate safeguards, which included a tariff of 25% for bars and 32-33% for grinding balls, was ignored, leaving the company in an unsustainable position,” he said.
Likewise, the unions grouped in AGOP (Asexma Biobío, Asem Biobío, CChC Concepción, Corma Biobío – Ñuble, Irade, Pescadores Industriales del Biobío, Pymemad and the Unión de Gremios Pymes Biobío) regretted the announcement, which “represents an irreversible blow, which “It threatens thousands of families directly and indirectly.”
Concern in Ñuble
In Ñuble, local actors expressed their concern about the situation facing the neighboring region.
Ricardo Salman, president of the CChC-Chillán, said that, “the closure of the steel plant is extremely regrettable, since it will have negative repercussions on regional employment and on the supply of products and inputs for the national industry. This loss of competitiveness is due in part to the increase in costs derived from reforms and low labor productivity. However, the biggest challenge lies in the decline in demand, aggravated by the national economic crisis, which has negatively impacted investment and growth. The construction sector is currently facing its worst streak since 1990, with 26 consecutive months of decline in activity, which affects both the demand for steel and cement and other inputs.
Meanwhile, Renato Segura, director of Didepro of the Municipality of Chillán, recognized that the loss of 20 thousand jobs also indirectly affects Ñuble, “since it is a segment of the population with income above the average, which has an impact negative in the service sector of Ñuble, such as tourism, for example. If neighbors become poorer, our economic system is negatively affected, without a doubt. Without prejudice to the above, in the short term, the precariousness of the labor market in Ñuble will not be an alternative to waiting for a migration of the labor force.”
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