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GOVERNMENT OFFICIAL SAYS SISAK IRONWORKS SHOULD TRY TO ORGANISE PRODUCTION INDEPENDENTLY

ZAGREB, Aug 24 (Hina) - After Russia's Mechel decided to suspendoperations of Sisak Ironworks, the head of the Croatian government'ssocial partnership office, Vitomir Begovic, said on Tuesday theironworks should try to independently organise the production.
ZAGREB, Aug 24 (Hina) - After Russia's Mechel decided to suspend operations of Sisak Ironworks, the head of the Croatian government's social partnership office, Vitomir Begovic, said on Tuesday the ironworks should try to independently organise the production.

"Trustee in bankruptcy Darko Sket should try to activate the production even without a strategic partner, because it is difficult to find a serious partner in a short period of time," Begovic told Hina.

Employees will receive their wages for August and there is a bank guarantee in case Mechel decides to cancel the 3.6 million-euro contract, Begovic said and added that 1,620 workers would receive six minimum wages.

Union leaders in Sisak Ironworks, Mato Somic and Sinisa Jurilj, said unions would make a decision on further moves regarding the protection of workers' rights on Wednesday.

Mechel Ironworks Sisak said in a statement on Tuesday that it made a decision to suspend its operations, adding that the company was conducting consultations with the Croatian government on exit mechanisms.

Mechel Ironworks Sisak officials said the decision was made because market conditions regarding the company's production and raw materials used in the production had drastically changed.

"Given the above stated factors the company made a decision to suspend operations," the statement said.

The contract with Russia's Mechel was signed on 6 February 2003 and on 10 March, after it received bank guarantees, the Croatian government adopted necessary decision under which the contract on the sale of the Sisak Ironworks became effective.

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