Unless you’ve been living under a rock (or maybe another country) you will have heard about the dire situation at Tata Steels that might spell disaster for the UK steel industry (as well as the global steel industry) thanks to China’s death-grip on the international export. Luckily for the steel industry there are ways it can be saved (maybe); it just needs a little help from its friends: China, the UK government, and us… (A poor man’s John, Paul, and George, I admit).
What China Can Do
The media is heaping a lot of the blame onto China right now as they are overproducing steel at an alarming rate and selling it off at a loss just so they can keep large portions of their populace employed. China produces more in a month than Britain can produce in a year. There is a lot of pressure on China from the international community to fix the problem and luckily China is listening for once to what other countries are saying. The country that brought us Bruce Li and sweet and sour chicken is going to reduce its annual steel capacity by well over 100,000,000 tonnes as well as reduce steel employment by 500,000 workers (not a good time to be a Chinese steel manufacturer). It’s a sorry state for them to be in, but you can’t help but blame them for the current catastrophe.
As always our government is late to the party. Instead of trying to sort the problem out months ago when they first found out, they are running around now like headless chickens to try and save the industry, but at least they are doing something. Part of the problem is the pound is so good that it costs companies too much to buy materials, plus everyone is just buying Chinese anyway, so the government is trying to get people to ‘buy British’. What an excellent plan. What they should be doing is ensuring the protection of existing businesses like the one found on this website, or ensuring the security of the two major Tata steel plants.
Another option for them is to nationalise like Scotland did which single-handedly saved the industry up there, however, Wales say they can’t and for some reason England won’t… so that’s out the window. Bye, bye.
What WeCan Do
Not much, really, apart from ‘buy British’… apparently. Although, if you have a few hundred million pounds in your mattress you could just buy the steel plants… Don’t know what good that would do, though.
Basically, this problem is much bigger than little ol’ Blighty. Perhaps the government could turn it around and save one of the few manufacturing industries left in Britain, but then what about the world? China has almost single headedly crippled the steel industry in much the same way that Saudi Arabia did with the oil industry. Once we fix Britain’s steel, we will need to pool the international community together to fix theirs.