Loan To Support South Australia Steel Sector
22 July 2016
Malcolm Turnbull has announced a $49.2 million loan to support South Australia’s ailing steel sector and workers at Arrium.
The Export Finance and Insurance Corporation will provide the loan under the National Interest Account for new machinery at the Iron Knob and Iron Baron mines.
“This will enable Arrium’s OneWhyalla business to process iron ore to export quality and is expected to boost Arrium’s cash flow by more than $200 million over the next five years,” Mr Turnbull said in a statement.
The government has already announced plans to maximise use Australian steel in naval shipbuilding, bring forward a planned upgrade of the railway between Adelaide and Tarcoola, and strengthening of anti-dumping rules.
“The Turnbull government will continue to work closely with the administrators as they prepare Arrium’s businesses for sale,” he said.
Arrium was placed in administration in April after negotiations with its lenders failed amid sustained low commodity prices. The restructuring and sale of the group is expected to be finalised by the end of the year.
Arrium workers have signalled they would not accept a 12 per cent pay cut to help save the Whyalla steel plant. The Australian Workers Union has put forward a counter offer of a 7.5 per cent pay cut which would also pare back overtime entitlements.
Source : theaustralian.com.au