Crossroads Asia | Financial system | Central Asia
After years of security issues, ArcelorMittal confirms its in talks to switch possession to Kazakhstan. However a change of possession gained’t essentially make mining any safer.
Tokayev talking to households and residents in Temirtau, Karaganda area.
Credit score: Akorda.kz
When a hearth broke out on the Kostenco coal mine in Kazakhstan’s Karaganda area on October 28, 252 individuals have been underground. Though 206 have been safely evacuated to the floor, 46 miners died within the mine.
Kazakh President Kassym-Jomart Tokayev did not mince words, calling ArcelorMittal – the worldwide mining big and father or mother firm of ArcelorMittal Temirtau, which operates the Kostenco mine – “the worst in our historical past when it comes to cooperation between the federal government and [a private] enterprise.”
After expressing his condolences to the households of the miners killed, Tokayev declared October 29 a Day of Nationwide Mourning and “gave directions to terminate funding cooperation with ArcelorMittal Temirtau.”
Though the incident prompted Tokayev’s strident remarks, the federal government and the corporate have been already in talks to separate. In a press release, ArcelorMittal confirmed that “the 2 events have been in discussions regarding the way forward for ArcelorMittal Temirtau and lately signed a preliminary settlement for a transaction that may switch possession to the Republic of Kazakhstan.”
ArcelorMittal Temirtau is the biggest producer in Kazakhstan’s metal and mining sector. Its metal plant in Temirtau – commissioned in 1960 and purchased by ArcelorMittal in 1995 amid the post-Soviet privatization increase – has an annual capability of 4 million tons of crude metal. The corporate additionally operates eight coal mines in Karaganda area and 4 iron ore mines in Central and Northern Kazakhstan.
4 miners died in a hearth at a unique ArcelorMittal Temirtau mine in August. On the time, Kazakh Prime Minister Alikhan Smaiylov laid blame squarely on the toes of the mine’s homeowners, saying, “That is primarily the fault of the homeowners of the corporate. Their full ignorance of the corporate’s actions has been resulting in tragic occasions for a number of years.”
During an August 19 meeting concerning the hearth on the Kazakhstanskaya mine, Smaiylov claimed that “each second loss of life within the ArcelorMittal worldwide group… happens exactly within the Kazakhstan division.” He stated that greater than 100 individuals had died at ArcelorMittal Temirtau amenities within the final 15 years alone.
Nationalization will not be the salve Kazakhstan seeks. Growing older mining infrastructure will probably be a troublesome, and costly, hurdle to surmount. And violations of security requirements on the mines, or different amenities, is not going to essentially vanish with a change of possession. That stated, nevertheless, nationalization will tie accountability for future accidents to Astana somewhat than a distant Luxembourg-based multinational conglomerate owned by an Indian billionaire.
As with the wildfires earlier this 12 months, Tokayev moved swiftly to position himself on the website of the catastrophe and be seen taking motion, together with talking on to households affected.
Not less than 15 individuals, largely emergency employees and firefighters, died battling blazes within the northeastern Abai area in June 2023. The spouse of one of many males who died complained to RFE/RL’s Kazakh Service that there have been by no means any spare components for the forestry division’s autos; her husband took his non-public automotive to battle the fireplace. “It looks as if all of the autos are consistently damaged down, they usually don’t have anything to repair them with,” she stated.
Such feedback, and Tokayev’s fast dismissal of the Emergency Conditions minister on the time, prompted dialogue of corruption, however didn’t clearly yield any deep introspection concerning the nexus between authorities, corruption, and security.
Nationalization could transfer ArcelorMittal Temirtau’s mine and amenities into authorities management, nevertheless it is not going to instantly enhance them. That may take severe effort, and cash, on Kazakhstan’s half.
