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Paris has cast doubt on the sale of British Steel’s British operations after the head of the French steelmaker SNCF warned that French workers at the site have been “infiltrated” by foreign nationals.
The construction of a new planned steel plant at Port Talbot in Wales, which is subject to a 160 million pound ($220m) sale, would only be possible if the “xenophobic” attitude of some workers at the site was a thing of the past, said Jacques Ensor, head of France’s national railway group, the SNCF.
“A French company cannot be able to operate in Port Talbot, because of the various foreign investments that its owners have made in Port Talbot,” he told a business conference on Wednesday.
French carmakers have invested heavily in Port Talbot since 2010, but when Mr Ensor was asked what was going on, he responded that the majority of British Steel’s main workforce “have always been French employees”.
The warning is the latest in a row which has erupted between Paris and the British government about whether Port Talbot has been neglected and whether foreign investors have undue influence.
The statement by Mr Ensor, an avowed leftist, is the strongest criticism yet by a high-profile French official against the planned sale, made to India’s Tata Steel last July by Greybull Capital, the US-based private equity group.
French officials had welcomed the British government’s support for the planned takeover, as they face down a direct challenge from the far-right government of Marine Le Pen.
Companies across Europe are being drawn to Port Talbot by lower wages and cheaper electricity than in other areas of the UK. The site has been enjoying a boom over the past three years as demand for steel and other metals has soared.
Werner Baumann, chief executive of the European steel association, Eurofer, said the sale “highlights that there is strong global demand” for steel and the site should not be “subject to discrimination”.
Mark Beech, chief executive of Greybull, later said “people should be able to decide who they want to work with” in Port Talbot.
The fight over Port Talbot took a further twist last week when UK ministers stepped in to try to block the sale of Tata’s loss-making Brazilian steel plant to Russia’s Evraz, even though Evraz officials admitted they had not looked at the site.
The UK government’s intervention to block the sale of a plant that had already been sold underscored the uphill struggle that the UK faces to safeguard skilled manufacturing jobs in an increasingly globalised economy.
In response to criticism from the left, the union Unite accused the French government of “stonewalling” on the sale of British Steel’s French plant. It repeated the union’s demand for a “thorough, independent investigation of the job situation at French plants which could lead to better jobs for British steelworkers”.