Published by Global Banking and Finance Review
Posted on December 9, 2024
BERLIN (Reuters) - Chancellor Olaf Scholz announced several measures to prop up Germany's ailing steel sector on Monday after he met with industry representatives to discuss high energy prices, cheap Asian competition and an economic downturn.
In a statement issued by his spokesperson, Scholz said he would initiate the extension of state aid allowing employers to switch employees to shorter working hours during an economic downturn.
He also said his government would seek to cap the costs of electricity transmission at 3 cents per kilowatt hour, partly finance the costs of the transmission grids and ensure that transmission grid fees do not increase in 2025.
Prospects for the proposed aid in the current legislative period are uncertain after the collapse of Germany's governing coalition last month. A snap election is to be held in February.
Germany is the world's seventh-largest crude steel producer, and the EU's largest steel producer. Its steel industry generated 55.2 billion euros in sales and employed around 90,000 people in 2022.
Monday's meeting included representatives of the steel unit of Thyssenkrupp, Salzgitter, Stahl Holding Saar and Arcelor Mittal.
Scholz said in a weekend newspaper interview that he would not rule out Berlin potentially taking a stake in Thyssenkrupp Steel, which is planning to axe thousands of jobs.
(Reporting by Friederike Heine, Editing by Rachel More)
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