Belgium steps up Opel 'protectionism' offensive

15th September 2009, Comments 0 comments

Belgium has stepped up its offensive against German state aid to auto manufacturer Opel's planned new owners, demanding that the slightest hint of protectionism be slapped down by Brussels.

BRUSSELS - The European Commission must approve 4.5 billion euros (6.5 billion dollars) of aid offered by German Chancellor Angela Merkel's government, currently less than two weeks away from a general election.

Amid fears shared by other European Union member states that plants elsewhere may be sacrificed to keep 25,000 German Opel staff in work, the head of Belgium's Flanders regional government took the case for an Antwerp factory threatened with closure to the EU's executive arm.

Seeking assurances that politics would play no part in Bussels' decision on whether or not to approve the aid and the takeover, Kris Peeters told EU Commission vice-president Guenter Verheugen of Germany that Antwerp would win out on purely economic and commercial considerations.

"For Commissioner (Verheugen), there can be no question of protectionism and he will keep a close eye on this to make sure economic parameters lie behind decisions on whether to close or keep sites open," the Flemish leader told reporters.

Peeters fears that the plant in northern Belgium, which employs around 2,700 people, is to be sacrificed by Canada's Magna and Russia's Sbersbank, who were on Thursday named by General Motors as the preferred buyers for its European division.

He said submissions on aid and on the comparative merits of the different plants within Europe which may be affected have yet to be submitted.

"But when these reports are received, it has been confirmed to us that (only) economic arguments will be taken into account," he added.

His call for a level playing field came as Magna's co-chief executive Siegfried Wolf said the Canadian auto parts maker planned to cut 10,500 posts at loss-making Opel once it completes its takeover.

Previously, the figure reported was 10,000 job cuts throughout the Opel business, including Vauxhall, which employs some 50,000 workers across Europe.

Wolf did not say where the job cuts would be made.

German news magazine Der Spiegel has reported that a comparative analysis of competing sites gave Antwerp a higher productivity rating than one of the four Opel factories in Germany, in Bochum.

A Commission spokesman denied being in receipt of any such material and stressed that politics would play no part in its decision.

"Decisions such as these must only be taken on economic and commercial grounds, and not for political reasons," said a Commission spokesman, who added that the dossier would be checked to ensure competition rules were "scrupulously respected."

On Sunday, Belgium's Foreign Minister Yves Leterme raised the issue with his counterpart from Spain, where 7,000 workers are also fretting over their futures.

Under the deal announced Thursday, GM will sell a 55-percent stake in Opel to a consortium equally owned by Magna and state-owned Russian lender Sberbank. GM will retain 35 percent and employees the rest.


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