"EU didn't fear Serbian steel, but is afraid of Chinese"

The Serbian government and China's He Steel will have to fight in order for the EU to approve Zelezara Smederevo's "production at full capacity."

Izvor: Beta

Thursday, 14.04.2016.

12:25

Zelezara Smederevo (Tanjug, file)

"EU didn't fear Serbian steel, but is afraid of Chinese"

Zelezara, the only Serbian steel mill, has been acquired by the Chinese company for EUR 46 million, with the contract expected to be signed

next week.

He Steel has announced it will increase the factory's annual production to 2.1 million tons - while it would be "phenomenal" for Serbia if the capacity were to be expanded to 3.5 million tons, said Vucic.

"Others find this to be a problem, because they fear that Smederevo will, with new owners and price and quality, beat Kosice and many other EU steel makers. Europe was not afraid of a Serbian steel mill, but is very much so afraid of a Chinese one," he remarked.

Vucic added that Dutch HPK Engineering, that managed the company until now, "did what was possible, lowered the price of raw materials and production, found new buyers, but could not influence the falling price of steel."

The prime minister said that the exact figure is not yet known when it comes to Zelezara's losses - "but it would have been bigger had HPK, which under the contact has a right to bonuses, but only under certain conditions, not taken over."

"Before we determine whether HPK has a right to a bonus and how big a bonus, we must see whether they fulfilled their contractual obligations," Vucic said.

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