More talks as Tata Steel saga continues

More talks as the Tata Steel saga continues
More talks as the Tata Steel saga continues

Talks sparked by the Tata Steel saga has led to China agreeing to tackle its overcapacity of steel production, according to the UK government.

For the first time, all major steel producing nations representing 90 per cent of the world's production came together for talks in Brussels to discuss the excess capacity crippling companies.

The talks has been described as "constructive" by Business Secretary Sajid Javid.

Meanwhile, Tata - which has a plant in Hartlepool which employs around 500 people - has appointed a chief executive for its UK steel business as efforts continue to find a buyer for its loss-making plants.

Bimlendra Jha, an executive member of Tata Steel Europe, takes the new post at a critical time.

He is executive chairman of Tata's Long Products business, including the huge plant in Scunthorpe, which was sold last week to Greybull Capital.

Tata revealed it had contacted 190 potential financial and industrial investors worldwide since launching its sale process a week ago.

Mr Javid of China's involvement in the talks said: "They have absolutely recognised that it is a problem of overcapacity in their country. They're committing to do something about it and I think that's a very positive step forward."

Over-production was the main issue to tackle, said the minister, adding: "I don't think anyone expects an overnight solution to that. The discussion today with all these countries coming together is something that we pushed for, and China's participation will help make the difference.

"With regards to Tata, the sales process - the formal process - has now begun, we're starting to be approached by interested parties. It's too early to say much about them at this stage but the important thing is, as we said all along, we will do everything we can to help with that sales process. The steel workers of Britain deserve nothing less."

Tata also announced the appointment of Standard Chartered Bank as an additional adviser to its sale process.

Gareth Stace, director of UK Steel, said: "What we needed to see at today's meeting was an agreement by national governments to take short term, detailed actions to help address the steel sector crisis.

"However, having agreed what the problems are we appear to be no closer to finding international action to put in place solutions.

"Governments must be prepared to come together to take rapid and decisive action to ensure we have a level playing field on which to compete fairly, or they may face the prospect of seeing their steel sectors wither on the vine and die.

"This is a global problem which requires a global solution to remove current over-capacity and time is a luxury we don't have.

"In Europe we have already been through very painful restructuring and must now look to others, including China, to take the same radical action."

Defence Procurement Minister Philip Dunne said new guidelines implemented by the Ministry of Defence would ensure UK steel manufacturers have "every opportunity" to bid for tenders.

During defence questions, he told the House of Commons: "The Government has undertaken a new set of procurement guidelines for steel which we have implemented through the Ministry of Defence through a combination of briefings to the Defence Suppliers Forum, undertaken by the Secretary of State, and I have written personally to the chief executives of the 15 largest contractors.

"We're cascading that through the supply chain to ensure that for future defence procurement there is every opportunity for UK steel manufacturers to bid for tenders."