Govts scramble to protect jobs

 

PARIS: Governments scrambled to cushion the impact of the finance crisis yesterday with France launching a euro20-billion (euro1 = RM4.53) sovereign wealth fund and China unveiling a jobs protection plan as the car industry made huge new cuts.

Global markets suffered more heavy losses as the grim news piled up, with Japan reporting that exports fell at the fastest pace in seven years and as US consumer prices recorded their steepest one-month decline in over 60 years.

The impact of the crisis on the car industry was highlighted when France’s PSA Peugeot Citroen announced plans to slash 3,550 jobs and Japan’s Isuzu Motors said it would cut 1,400 jobs and domestic production by 10 per cent.

The Peugeot job losses could affect assembly-line workers, managers and office staff in all plants under the plan, which provides for voluntary departures, the company said in a statement.

The car sector plays a strategic role in the French economy and directly or indirectly accounts for one in 10 jobs there.
The latest cuts came as Republican lawmakers stalled a drive for an additional US$25 billion (US$1 = RM3.62) bailout for ailing US carmakers, insisting they use funds from a previous bill.

Yesterday, France’s President Nicolas Sarkozy unveiled a e20 billion investment fund to shore up key French companies hit by the economic crisis and protect them from foreign predators.

In Britain, the Society of Motor Manufacturers and Traders and the Retail Motor Industry Federation called on the government to shield the British car sector from a credit squeeze through loans and possible guarantees.

Rolls-Royce, the British maker of airplane engines, said it planned to cut up to 2,000 jobs worldwide in 2009. British defence manufacturer BAE Systems said it was cutting 200 jobs as its workload was “tailing off.”

The Anglo-Swedish pharmaceuticals giant AstraZeneca said it would slash 1,400 jobs by 2013 as it shuts factories in Belgium, Spain and Sweden.

Mazda, Japan’s fifth largest carmaker, said it would scrap 1,300.

A top Chinese official meanwhile warned the Asian giant was facing serious unemployment problems due to the global economic crisis.

“The employment situation is critical, and this impact (of the crisis) is still unfolding,” said Yin Weimin, the social security minister.

Yin said the government would provide financial aid to help firms maintain employment, especially in light industry which employs up to 40 million Chinese, as well as tax cuts aimed at helping the textile industry. — AFP