The closure of the
ArcelorMittal, which was formed in 2006 from the takeover and merger of Arcelor by Indian-owned
It closed its operations here in
According to the Working Paper titled 'Impact of the Closure of a
'Additionally, the fiscal accounts will not benefit from corporation taxes, business levy tax, green fund levy, Value Added Tax (VAT) and property taxes with the closure of this company. With respect to inflation, while it is expected that iron and steel imports will increase, global prices are forecasted to decline and as a consequence, the impact on inflation is expected to be minimal.'
The Paper, written by
It said that the revenue streams of several statutory boards and similar bodies, and state enterprises such as
'On the other hand, the closure of this steel company resulted in a reduction in pollution, which positively affected the environment,' the authors of the study noted.
The Paper said that the closure of ArcelorMittal highlights the need to strengthened labour market policies.
It said that the
'These policies are aimed at providing income support for job loss such as unemployment insurance as well as facilitating the return to work through employment programmes, including employment-intensive programmes, skills development and entrepreneurship support measures.'
But it noted that in countries where unemployment insurance programmes are not available consideration should be given to designing and implementing a contributory unemployment insurance scheme. 'Additionally, skill training agencies/programmes can link training to occupations that are experiencing shortages (manufacturing sector) or where future job growth is projected.
'Finally, foreign investment is guided by polices outlined in bilateral investment treaties. One observation has been that while investors are protected from various forms of state actions, these treaties do not always outline the responsibilities of investors. Countries need to reassess their model bilateral investment treaties to ensure the best outcomes for their economies.'
© Pakistan Press International, source