27 January 2004

BARCELONA – The minister of Economics Rodrigo Rato announced Tuesday a package of help for the electronics industry in the wake of the closure of two multi-nationals in Spain.

This month alone, Samsung has announced it is to move its factory near Barcelona to Slovakia, putting 446 jobs at risk.

And Philips, another electronics giant, announced the closure of its factory near the Catalan capital with the loss of 100 jobs.

Samsung said labour costs were cheaper in eastern Europe.

Rato made the annoucement as he attended a conference to talk about the new challenges that affected the Spanish economy.

He said the government has been negotiating for some weeks a programme of research and development for the electronics sector.

Rato said that the agreement will be finalised in the next few weeks and it will be in the same way as help given to the textile sector. Both sectors have a strong presence in Catalonia.

Rato said: “There is no need for alarm in Catalonia at the threat of more companies leaving but it is true that the new tripartite political agenda means there is too much politics and not enough concentrating on the true problems of Catalonia.”

Rato added: “Spain has not created mass employment by maintaining the rules that we had before. If we had had the same labour rules that we had in 1995, we would have created 1.8 million fewer jobs.”

Rato’s ruling conservative Popular Party has been in power since 1996 and in the run-up to the general election in March, he was keen to use this as an opportunity to win votes.

Rato, vice-president of the government, claimed: “We have to have labour politics. Labour politics has to have two priorities: that the renumeration for work is not linked to your contract but to your productivity.”

Samsung said it was changing the structure of its European production and will move its plants in Spain and the UK to other factories which the company has in Slovakia.

Unions have expressed doubts over Samsung’s promise to relocate its 446 workers from the plant near Barcelona.

The company said Slovakia will be its new European base.

Sang Heung Shin, Samsung’s European president, said Thursday the company was concerned about the effect the restructuring will have for employees at the Spanish plant.

He said that before the decision was made to close the Spanish the company had studied all the alternatives but there was “nothing else which could guarantee the competitive future of the company”.

Samsung justified its decision by saying in the electronic consumer goods sector, the giddy rise in technological development had cut short the commercial life of some products and caused a fall in prices.

According to Samsung, this situation demanded a large investment, which required reducing the number of factories and the costs of production, components and other associated goods.

In Spain, the factory at Palau de Plegamans was dedicated to making audiovisual equipment destined for the export market. The factory currently employs 446 workers.

The production of mobile phone parts, which is also carried out at the same plant, will be moved to another plant in China.

According to the company, the employees will not be affected by the changes and will be relocated.

[Copyright EFE with Expatica]

Subject: Spanish news