Krupp inflames strike with steel plant closure

BERLIN - The industrial giant Krupp yesterday announced the closing of a steelworks in eastern Germany, a move likely to heighten tensions during the spreading steel and engineering strike. More than 30,000 workers have been taking part in the walk-out in eastern Germany, and thousands more will join the picket lines today. Preliminary talks over higher wage demands have stalled.

Jurgen Harnisch, the chairman of Krupp, told a news conference in Bochum in western Germany that the Oranienburg plant was losing too much money to justify keeping it open. Krupp has poured 70m marks (pounds 28.6m) into the works since taking it over in 1990 from the agency selling off Communist businesses in the former East Germany.

Mr Harnisch said the company hoped to avoid lay-offs among the 285 employees. It was not certain where they would be offered work once the plant near Berlin is closed on 30 June.

Today the Oranienburg workers are scheduled to join the metalworkers' strike sweeping across eastern Germany. The local union leader, Hasso Duvel, said he had ordered strikes at about 20 more companies today in the state of Saxony, sending thousands more workers on to picket lines.

Workers are demanding a pay rise of more than 20 per cent that was to have taken effect on 1 April. Employers agreed to the increases in the euphoria of German reunification, but now say they do not have the money to pay them. Instead they are offering a 9 per cent rise.

Dieter Kirchner, a leader of the metal industry employers' federation, yesterday urged the unions to return to the bargaining table. 'After we'd cleared away a lot of junk, it's totally incomprehensible that the IG-Metall union said last night that we couldn't negotiate any further,' he said.

He also raised the possibility of a lock-out in plants where some work has continued despite the strike. A new round of talks to settle the dispute was scheduled for today in the northern city of Rostock.