Liquidation of state plant threatens thousands of Egyptian workers and families

Liquidation of state plant threatens thousands of  Egyptian workers and families

London—Thousands of employees of an Egyptian government-owned fertilizer plant must not be dismissed without compensation to make way for a housing project, says ImpACT International for Human Rights Policies.

An estimated 2,500 people currently work at Talkha Fertilizer Plant in Egypt’s Dakahlia governorate. They launched a sit-in at the plant on 3 December to protest the government’s planned closing of the plant without offering workers an alternative source of income or other form of compensation.

A member of the Egyptian SurveyAuthority and Engineering Authority of the Armed Forces came to the company's headquarters to measure the area of ​​the land on which it’s built and confirmed that the governor of Dakahlia will close the plant next Sunday

- Hasan Samir, a member of the labour union

The plant is managed by Delta Company for Fertilizers and Chemical Industries, which is operated by the Holding Company for Chemical Industries (HCCI) and owned by the Egyptian Ministry of Public Business Sector.

"A member of the Egyptian Survey Authority and Engineering Authority of the Armed Forces came to the company's headquarters to measure the area of ​​the land on which it’s built and confirmed that the governor of Dakahlia will close the plant next Sunday," Hasan Samir, a member of the labour union, told Egyptian media.

The plant’s closure was initiated without any prior notice, according to Samir. When the possibility of closing the facility was first raised, the General Union of Chemical Industry Workers objected. Company management then reversed itself, saying in August the facility would stay open. That commitment didn’t stick, however.

"The decision to liquidate the plant means that thousands of workers will be laid off without any alternative source of income," said Muhammad Muwafi, one of the protesting workers at the plant. "The plant employs about 2,500 workers directly and another 7,000 benefit indirectly, such as drivers and salesmen."

The pace of work at the plant began to slow in April, after a fire broke out in one of its main engines. The workers called for its repair, but no response was forthcoming.

Talkha was built in 1974 to produce urea, a nitrogen-based fertilizer. When operating at full capacity, the plant can produce 249,000 tons of the fertilizer—a significant reason why Egypt was able to meet the country’s demand for the product from internal sources. This success excluded the company from the government’s privatization of many formerly state-run businesses in 2004. However, the company went into debt when the government ended the subsidies that had allowed it to sell fertilizers at below-market rates to support farmers and boost agricultural production.

The decision to liquidate the plant means that thousands of workers will be laid off without any alternative source of income

- Muhammad Muwafi, one of the protesting workers at Talkha Fertilizer Plant. 

The governor of Dakahlia, Ayman Mukhtar, has been quoted in Egyptian media as estimating the value of the 400-acre site on which the plant is located at 23 billion pounds—a sum that will be distributed after sale between the company, the governorate and the state treasury.

The thousands of workers and their family members should not have to suffer due to the government’s failure to plan for the crisis resulting from the debts accumulated by the Talkha fertilizer plant. It is the responsibility of the Egyptian government to quickly mitigate the grave effects on the future of the workers and their families, particularly in light of the absence of employment alternatives in today’s economy.

Egypt is required under the Protection of Wages Convention ratified by its government in 1949 to pay unemployment benefits to workers who suffer loss of earnings due to even a partial cut in hours.

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