Government, GWU meet over future of STMicroelectronics
Both sides urged the media to avoid speculation which, they said, could only harm the workers
The government remained without a response to the offer it made last week for the semiconductor giant STMicroelectronics not to shift its local operations elsewhere.
The company's management has chosen not to comment to the press about the matter. However, a joint statement by the government and the General Workers' Union said the company had made no counter offer.
The Sunday Times reported this week that ST, by far Malta's biggest private sector employer with about 2,200 workers, had asked the government for a financial support package running into tens of millions of dollars.
An offer for investment aid was made by the government last week but the gap between the two sides is believed to be significant.
The government and the GWU discussed the situation at ST Microelectronics at a meeting yesterday and later issued a joint three-paragraph statement saying they had agreed to work together on the issue in the interest of the country and the workers.
At yesterday's meeting, the union was briefed about the negotiations. Both sides urged the media to avoid speculation which, they said, could only harm the workers. When contacted, the union's general secretary, Tony Zarb, said he had no comments to make and simply referred to the statement, signed by himself and Finance Minister Tonio Fenech.
The Kirkop plant is said to be facing losses that could reach €58 million (Lm24.9m) a year, primarily as a result of labour costs and exchange rate pressures. The latter, in particular, has been exacerbated by the growing gap between the dollar, the currency in which the company trades its semiconductors, and the euro, the currency in which the company pays its bills, including salaries. The gap between the two currencies means that the company's costs, in euros, are inflated with respect to the company's revenue, in dollars.
Mr Zarb had complained that that the management was making a labour cost comparison with Asian markets, pointing out that the cost per unit in Malta is about $16 while that in Asia is just $2.
The group has already decided to shut down operations deemed to be unproductive in Morocco and America.