Chinese Steel
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http://af.reuters.com/article/energyOilNews/idAFL3N15A2YH
Reuters wrote:MANILA Jan 26 (Reuters) – China's plan to cut its steel production capacity by 100-150 million tonnes will lead to the loss of up to 400,000 jobs, the official Xinhua news agency reported.[….]"Large-scale redundancies in the steel sector could threaten social stability," Xinhua quoted Li as saying.
That's a horrific figure, even if, relatively, it's not enormous, but it will mean devastation of communities, and could lead to concentrated pockets of dissafection.
This is the human face of the stock market slides of the last week or so.
As Xinhua (chinese state media) reports:
http://news.xinhuanet.com/english/2016-01/25/c_135044264.htm
They're looking at a ;restructring fund' of £7.2 billion p.a.
(about the same as the official UK unemployment).
http://news.xinhuanet.com/english/2016-01/27/c_135050443.htm
Quote:Xinjiang saw sharp declines in imports and exports with Russia and countries in Central Asia as a result of weakening currencies, slowing growth and slumping demands, according to data released by the local customs office.Foreign trade volume for the region totaled 19.7 billion U.S. dollars in 2015, down 28.9 percent year on year. Exports shrank by 25.4 percent at 17.5 billion dollars, while imports plunged by 48.2 percent at 2.2 billion dollars.Exports of electromechanical products, textiles and shoes dropped by 11.4 percent, 45.2 percent and 27.9 percent respectively, according to the data from Xinjiang Customs.The declines have been partly attributed to slower growth among emerging markets in the region, which are experiencing difficulties brought about by lower energy prices, acute structural imbalance and capital outflow, said Duan Xiufang, an economist with Xinjiang University of Finance and Economics.This explains some of the problems China is facing, and this shows the effects of the slump in oil prices (though, Shirley, someone somewhere should be booming as they buirn cheap oil to make things, but that doesn't seem to be happening, maybe the rent value is just being unrealised).Ah, maybe the African growth accounts for it:http://news.xinhuanet.com/english/2016-01/27/c_135050751.htm
http://news.xinhuanet.com/english/2016-01/27/c_135050686.htmAn interesting story that continues on the link (and also goes back to the robots thread).A Chinese built machine, costing $23,000 can turn out 2,000 hollow concrete blocks a day (perfect for hot countries). These bricks can be used for building by slotting together.
Quote:They make the blocks from quarry dust, which is mixed with sand and cement inside a mixer and fed into the compression machine, which then molds the mixture into shape of the respective blocks."This is a new technology of producing the construction materials and largely reduces the expenses of building houses by up to half the total cost," explained Ngugi."You no longer need cement as the principal material at the construction site if you are using the hollow blocks. You could only need it when plastering, and this by far is a relief to the pocket since you could require four wheelbarrows of sand for a bag of cement," he noted.The technology reduces the amount of raw input as one bag of cement can produce ready-to-use 250 concrete blocks.Our Socialist Banner has recently been casting doubt on the story of Africa Rising and pointing to a growing slump on the continent caused by the fall in commodity prices, particularly oil and the drop in Chinese demand.http://socialistbanner.blogspot.com/2016/01/china-sneezes-africa-catches-cold.htmlhttp://socialistbanner.blogspot.com/2016/01/ghanas-boom-bursts.htmlYou may also find this Al Jazeera story of interesthttp://www.aljazeera.com/news/2016/01/analysis-global-stock-market-plunge-2016-160127190807213.html(I have to admit the personal failing of taking a little bit of schadenfreude in regards to the knock-on effect of China's fall in demand upon Australia. I met more than one Aussie expat who took great delight in extoling the Australian $ strength and its strong economy and my answer was at the time…"wait til China has a recession and see if you stil bragging then"… )
The Weekly Worker take on the approaching economic crisishttp://weeklyworker.co.uk/worker/1091/the-impending-global-recession/
There are 130,000 members of British Steel pension scheme, sponsored by Tata & with £485m hole. This steel crisis is about more than jobs
— Robert Peston (@Peston) March 31, 2016
Quote:There are 130,000 members of British Steel pension scheme, sponsored by Tata & with £485m hole. This steel crisis is about more than jobsThat is significant, what's coming down the line is a withdrawl of investments made by that steel pension coupled with a fall in demand as those steel workers move into lower paying jobs (as Paul Mason notes, re-skilling=de-skilling when talking abo9ut steel workers):https://medium.com/mosquito-ridge/steel-crisis-they-do-not-give-a-shit-86516750a1e0#.btnv3akcu
Quote:“There, there, let’s re-skill them”, they will say; “and let’s exempt them, for a while, from coercive bullying at the job centres”. It is just cant.The skill levels of this industry are so high; the ratio of capital to labour so high; that nine times out of ten “re-skilling” means simply de-skilling.Oh, and before we join the nationalists in the Labour party, this is hurting our fellow workers in China:http://www.theguardian.com/business/2016/feb/29/china-to-cut-jobs-in-coal-and-steel-sectors
Quote:China expects to lay off 1.8 million workers in the coal and steel industries, or about 15% of the workforce, as part of efforts to reduce industrial overcapacity.It was the first time China gave figures that underlining the magnitude of its task in dealing with slowing growth and bloated state enterprises.Yin Weimin, the minister for human resources and social security, told a news conference on Monday that 1.3 million workers in the coal sector could lose their jobs, plus 500,000 from the steel sector.Finally, it is interesting that jeremy Corbyn has put his name to a petition:https://petition.parliament.uk/petitions/126128(If you go to the Map, you'll it has been chiefly signed in South Wales, but it has surged well past 100K signatures, it will get debated). This is his populist touch in action.
A pause for thought:https://twitter.com/afneil/status/715485327477972993
Quote:China has produced more steel in past two years than UK has managed cumulatively since industrial revolution in 19th century.If true, that's quite a thought. Isn't it also a wonderful hing that we can produce so much steel?
Governments have to see to the overall general interests of their country's capitalist class as a whole and as there are conflicting interests they have to arbitrate between these. Steel producers don't like cheap steel imports but steel consumers, such as the car industry, do. The BBC has been reporting this morning that the UK has been opposing the EU imposing higher tariffs on imported Chinese steel:
Quote:The European Steel Association said the UK had been blocking an EU measure which would have tackled the "dumping" of cheap Chinese steel in Europe, which is partly being blamed for the crisis. (….) The UK has argued against higher tariffs, saying they would hit other sectors such as the car industry, which import a lot of foreign steel.I imagine the outcome will be that the government will continue to side with the car rather than the steel industry. Bit of a dilemma too for Len McCloskey and UNITE (but he'll want to have his cake and eat it).
No doubt, this could also have a knock-on effect on the recycing industry, if the UK steel industry shrinks to the point where it is no longer viable for my local council to collect my baked beans tins?
I thought the following chart was helpful, in showing how jobs in the UK steel industry have declined over recent decades:http://www.cityam.com/227060/ssi-caparo-and-tata-steel-closures-this-chart-shows-the-decline-of-the-uks-steel-industry
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