Relaxation of sanctions for Aughinish until October provides a breather, says Niall Collins
CONCERN over the future of the 450 jobs at Aughinish Alumina in Limerick eased a little over the past week following the decision by the US to extend the deadline for companies to wind up business with Rusal from June to late October.
US Treasury Secretary Steven Mnuchin also said the US would provide relief from sanctions if Oleg Deripaska, the billionaire owner of Rusal, Aughinish Alumina’s parent company, gave up control of the company.
“Rusal has felt the impact of US sanctions because of its entanglement with Oleg Deripaska, but the US government is not targeting the hard-working people who depend on Rusal and its subsidiaries,” he said.
However, as reported last week, Deripaska has no intention of selling his 48% share and instead plans to reshuffle his management team to focus in on the sanctions.
The hope now is that further diplomatic approaches from Ireland and other European countries such as Germany, Italy and France which have significant auto and aviation industries which depend on supplies of aluminium, may lead to Aughinish or Rusal being exempted.
These approaches will rely heavily on “special relationships” with the US.
Fianna Fail TD for Limerick and party spokesman on Foreign Affairs and Trade, Niall Collins has welcomed the softening of sanctions for Aughinish as a “breather”.
“It is significant that it is the only place in the world where the sanctions have eased,” he said.
He ascribed the move to lobbying by the company itself, by the government and by Fianna Fail.
“What happened is the motor industry and aerospace industry in Germany, France and Italy started kicking up because the price of aluminium was going through the roof,” he said.
Meanwhile, pressure has eased somewhat in relation to the supply chain.
Following the announcement in early April that sanctions were on the way, Anglo-Australian mining company Rio Tinto, which is one of Aughinish’s main suppliers of bauxite and buyers of the alumina manufactured at Aughinish, announced that it was reviewing its trading relationship with Rusal and could pull out of current supply arrangements.
It then was reported that other suppliers and banks could also be forced to sever ties with the company, threatening the availability of raw materials and cash for the firm’s operations.
While the loosening of sanctions has eased fears of an immediate supply crisis at Aughinish, the long term future will remain under a cloud until the sanctions are lifted entirely or Derispaska sells his shares.