Billionaire Lakshmi Mittal will cut production at Romania'sbiggest steel plant down to about half, resorting to temporarylayoffs (15 days) for all 9,000 employees because the plant haslost export competitiveness amid an appreciation of the RON againstthe dollar and amid a lack of orders from the Turkish market, oneof the company's leading markets. Since the end of June, theRomanian currency gained 15.7% on the dollar. Year-on-year thedollar devalued by 7.2%, less than the around 8% inflation, whichamounts to an appreciation of around 0.8% in real terms. "Such ameasure was previously taken in April, but only targeted a segmentwhere orders were lacking and involved a much smaller set ofworkers. Now, all employees, from workers through to managers willbe laid off temporarily, for 15 days. The management cited asreasons for the dramatic drop in production the decline in ordersfrom Turkey, the dollar/RON exchange rate, which is unfavourablefor us, and the production cost, which is not covered by the salesprice," says Gheorghe Bezman, chairman of the Galaţi branch ofMetarom (the steel workers trade union federation).
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