LONDON (AP) – Manufacturer Tata Steel announced 1,200 job cuts in the U.K. on Tuesday, underscoring the damage caused by cheap Chinese imports and throwing a shroud over a state visit by Chinese President Xi Jinping designed to usher in a “golden era” of relations between the countries.
Tata blamed the layoffs in northern England and Scotland on a “flood of cheap imports, particularly from China,” along with high electricity costs and the strong pound.
Though the cuts had been rumored for days, the timing of the announcement – on the first full day of Xi’s visit – seemed designed to win maximum attention.
“The U.K. steel industry is struggling for survival in the face of extremely challenging market conditions,” Karl Koehler, chief executive of Tata’s European operations, said in a statement. “This industry has a crucial role to play in rebalancing the U.K. economy, but we need a fairer system to encourage growth.”
The British government is under pressure to raise the issue of China selling steel at a loss on world markets. Tata’s decision comes only weeks after Sahaviriya Steel Industries announced the closure of its plant in Redcar, costing 2,200 jobs. Another firm, Caparo Industries, went into partial administration on Monday, threatening hundreds more jobs.