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German builders fear influx of cheap workforce

Germany's construction companies and unions fear an economic catastrophe should a new European Union directive come into force. The new rule will allow international companies to import their own workers from different countries.

German builders fear influx of cheap workforce
Photo: DPA

The construction union IG Bau and the central association of the German construction industry (ZDB) have both expressed their concern that a cheap workforce could be imported from China should the directive, which is currently being discussed by the European parliament, be passed.

ZDB President Hans-Hartwig Loewenstein told news magazine Focus, “Our market would be on the brink of collapse. It would have catastrophic consequences for mid-sized companies.”

Loewenstein said there were 40 million young, unmarried men in China, hundreds of thousands of whom could come to work on European construction sites. “The German government is not giving us enough support,” complained Loewenstein. “And the main problem is that the EU Commission has no interest in German mid-sized companies.”

There are currently 700,000 people working in Germany’s construction industry. They have a minimum wage of €10.90 an hour in western Germany and €9.50 an hour in the east. According to Focus, this could theoretically be undercut by foreign companies if the EU directive comes into force.

For example, a Romanian company could employ Chinese people at the Romanian minimum wage of €175 a month and put them to work on German building sites.

In the past week, IG Bau boss Klaus Wiesehügel and the head of industry association HDB Michael Knipper both warned of the pressure on the German job market should the directive be passed.

DAPD/bk

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ENVIRONMENT

Sweden’s SSAB to build €4.5bn green steel plant in Luleå 

The Swedish steel giant SSAB has announced plans to build a new steel plant in Luleå for 52 billion kronor (€4.5 billion), with the new plant expected to produce 2.5 million tons of steel a year from 2028.

Sweden's SSAB to build €4.5bn green steel plant in Luleå 

“The transformation of Luleå is a major step on our journey to fossil-free steel production,” the company’s chief executive, Martin Lindqvist, said in a press release. “We will remove seven percent of Sweden’s carbon dioxide emissions, strengthen our competitiveness and secure jobs with the most cost-effective and sustainable sheet metal production in Europe.”

The new mini-mill, which is expected to start production at the end of 2028 and to hit full capacity in 2029, will include two electric arc furnaces, advanced secondary metallurgy, a direct strip rolling mill to produce SSABs specialty products, and a cold rolling complex to develop premium products for the transport industry.

It will be fed partly from hydrogen reduced iron ore produced at the HYBRIT joint venture in Gälliväre and partly with scrap steel. The company hopes to receive its environemntal permits by the end of 2024.

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The announcement comes just one week after SSAB revealed that it was seeking $500m in funding from the US government to develop a second HYBRIT manufacturing facility, using green hydrogen instead of fossil fuels to produce direct reduced iron and steel.

The company said it also hoped to expand capacity at SSAB’s steel mill in Montpelier, Iowa. 

The two new investment announcements strengthen the company’s claim to be the global pioneer in fossil-free steel.

It produced the world’s first sponge iron made with hydrogen instead of coke at its Hybrit pilot plant in Luleå in 2021. Gälliväre was chosen that same year as the site for the world’s first industrial scale plant using the technology. 

In 2023, SSAB announced it would transform its steel mill in Oxelösund to fossil-free production.

The company’s Raahe mill in Finland, which currently has new most advanced equipment, will be the last of the company’s big plants to shift away from blast furnaces. 

The steel industry currently produces 7 percent of the world’s carbon dioxide emissions, and shifting to hydrogen reduced steel and closing blast furnaces will reduce Sweden’s carbon emissions by 10 per cent and Finland’s by 7 per cent.

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