By the editors, New Cold war.org, Dec 8, 2014
Workers at the steel works in Kremenchug, Ukraine are protesting the announcement by works owners that the company will cut 2,500 jobs. On Dec. 6, about 1,000 workers rallied in the center of the city. Kremenchug is located on the Dnieper River, 400 km southeast of Kyiv and 150 km northwest of Dnipetropetrovsk, in Poltaska oblast (province).
The steel works at Kremenchug are connected to iron and steel casting manufacturers. Among its products are railway wagons and castings. One year ago, steel production was operating at full production. As a result of all the unknowns caused by Kiev’s turn to economic association with Europe and the war it is waging in the east of Ukraine, Russia has cancelled orders for rail and other products that use Kremenchug steel.
Workers are demanding that the layoffs be cancelled and that the company find alternative markets for steel, including any necessary conversions for new customers and grades of steel and castings. They have adopted a resolution stating: “We demand that the Cabinet of Ministers of Ukraine take the necessary measures to open the internal market of the railway car-building industry for an appropriate level of production. We demand from the owners of Kremenchug Steel Works the immediate cancellation of the decision to reduce the number of staff, that they fill unused capacity of the plant by finding alternative products in [transportaion] manufacturing and carry out a temporary conversion of the enterprise for such purposes.”
Failing that, workers say they will escalate their protest actions.
Alexander Shishkin, chairman of the trade union committee at the steel mill told Podrobnosti.ua News, “The job reductions will lead to a near-complete halt of production. It is not a work reduction; we interpret it as mass layoffs.”
Vladimir Fedotov has a degree in metallurgy and heads the laboratory work at the steel mill. He told Podrobnosti there is no chance he could find another job in his field. He will either have to move or change professions. “Sure there is free education tuition to train in another field, but I still require money in order to eat. The rise in prices of food uses all the money we earn.”
Workers think the company owners simply want to bankrupt it and walk away.
The Kremenchug steel works is one of the enterprises that was grabbed for a song and a dance by up and coming entrepreneurs in Ukraine at the time of independence in 1991. The main owner is Igor Kolomoisky, the billionaire financier of right-wing militias and political parties who dominates the economy of the region of Dnipetropetrovsk. The company’s ownership is registered in Cyprus.
After the collapse of the Soviet Union 25 years ago, it was those who had connections in the state bureaucracies and who had access to financing who became the new class of capitalists in Ukraine, Russia and other parts of the country. These were the largest privatizations in world history.
At Kremenchug, there were 3770 people employed in June 2014. As of August 1, that was down to 1,285 people. The company was idle from February 24 to June 30. Production began again for three weeks, but it was suspended again on July 23 when Russia withdrew orders for the plant’s products.
An article in the Oct. 2 Business New Europe, Industry takes heavy hit across Ukraine, details the catastrophic decline of manufacturing in Ukraine during the six months since the country signed an economic association agreement with the European Union. The article begins, “Ukraine’s economic collapse and the loss of Russian markets are taking a heavy toll on the whole of the country’s manufacturing sector and not just that in the war-torn Donbas.”
“Vehicle producers are worst hit, with several companies closing their doors and laying off workers. Lviv bus plant announced on September 15 that it had completely stopped production. “If Ukraine signs the economic part of the Association Agreement with the EU, no Ukrainian industrial producers will survive. Ukrainian companies cannot realistically compete in European tenders,” Lviv bus company owner Igor Churkin said in a media interview on September 21.
Sources in Russian and Ukrainian language for this report:
- ua news service, Dec 6, 2014
- Olga Carabao, Zaxid News, December 6, 2014
- Podronosti Television news and print report, Dec. 3, 2013
- NAH News, December 6, 2014