by Eric J. Lyman
ROME, June 9 (Xinhua) -- The fate of one of Europe's largest steel smelters is becoming a central issue for Italy's new government when the steel trade itself is facing an unclear future due to the U.S. decision to impose tariffs of 25 percent on steel and 10 percent on aluminium, for the European Union (EU), Canada and Mexico.
The Ilva steel plant in the southern Italian city of Taranto has long been under scrutiny for the pollution it produces for years. As long ago as 2005, the plant was seen as producing 90 percent of the dioxin in Italy and almost a tenth of Europe's dioxin.
Dioxins are toxic byproduct of some kinds of industry and tied to nervous system problems, damage to human immune systems, fertility and healthy development for children. Cancer rates around Taranto are also higher than the rest of the country.
Ilva employs nearly 14,000 workers and it produces around 13,000 metric tons of steel per day. It also has net financial losses of around 30 million euros (36 million U.S. dollars) every month. The plant, which has been run under state control since 2015, is reportedly set to run out of money within the next 60 days.
A year ago, Luxembourg-based steel conglomerate ArcelorMittal offered to buy Ilva for 1.8 billion euros (2.2 billion U.S. dollars), and to invest another 2.4 billion euros (2.9 billion U.S. dollars) to clean up and modernize the plant. But now the sale is on hold.
This week, Beppe Grillo, the comedian-turned activist who founded the Five-Star Movement, said Ilva should be shut down and turned into a kind of industrial museum. But Luigi Di Maio, who succeeded Grillo as leader of the Five-Star Movement, was quick to state that Grillo was expressing his personal opinion and that no formal decision on Ilva would be made without careful consideration.
The Five-Star Movement is the larger member of the two-party government coalition which was installed June 1. Taranto, the city where Ilva is based, is part of a stronghold for the Five-Star Movement, which won 48 percent of the vote there in the March 4 general election.
"This is shaping up to be a big internal problem for the Five-Star Movement," Nicola Borri, an economics and finance professor at Rome's LUISS University, told Xinhua. "Leadership would normally be in favor of closing down a dirty plant like Ilva. But Di Maio recognizes the political consequences of doing that to a major employer in a place like Taranto."
Mirco Rota, the national coordinator for Fiom-Cgil, the major trade union representing Ilva workers, said the union is eager to work with the new government to keep the plant open.
"We have sent a formal request to Rome to ask to discuss Ilva," Rota said in an interview. "We are just trying to understand what the government's plans are."
Further complicating the equation for Italy and Ilva is the U.S. plan to levy a 25-perfect tariff on steel sold from European Union companies in the United States. For its part, the EU has vowed to respond with retaliatory tariffs on U.S. exports.
