Svobodna Dnevnik

[Hadash]

Macharaviayaische Zeitung

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Mordvania: Government nationalizes foreign company
By: Elena Manstein
Published: Marth 14, 1587


Workers and families protest nearby a Nordlig plant in a demonstration organized by Labour Association 65.

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In an unexpected announcement, the Mordvanian government announced the nationalization of Nordlig Corporation, a Lanlanian-owned chemical company based in Mordvania. The nationalization decree was immediate, and was signed by President Zvezdana Serebryak.

Nordlig Corporation belongs to Diehad Ashton Inc., a company based in Lanlania. Diehad Ashton opened it first plant in the northern Brigidnan country in 1575. After opening another plant in Wojek, it was established as a subsidiary company, based in Mestarka, Mordvania. Nordlig opened another three plants between 1581 and 1582. The company employed nearby 50,000 workers in Mordvania, soon displacing local industry, becoming the second largest chemical corporation in the country by 1584.

The company was not without controversies, though. For almost four years, Nordlig has experienced labour protests, as workers from two trade unions -Labour Association 65 and the Confederation of Trade Unions- demanded to negotiate a collective bargaining agreement, which Nordlig management refused. Two years ago, it was rumoured that a state-owned bank was in negotiations to acquire a small amount of Nordlig stocks, but the negotiation apparently failed.

While the Lavika Party vaguely promised to "increase state intervention on the economy...in cases where the national interests and the well-being of the citizens are endangered" in its last political platform, the announcement came as a surprise. Although the state still owns an important number of state-owned banks and national companies in sectors such energy, telecommunications, transport or mechanized industry, nationalizations are rare. Since Zvezdana Serebryak was elected president in 1584, no private company was nationalized and the economic policy seemed rather focused on increasing social spending and public investment, or introducing social reforms – similarly as it happened during the left-wing coalition from 1573 and 1579. The confirmation of Wladyslawa Kolodka, who is considered a moderate in Lavika Party, as Minister of Finance was seen initially as a confirmation of this policy.

If it is not clear if there is a new industrial policy behind the unexpected nationalization. There have been rumours for some time that the Mordvanian government may be considering to build and strengthen state-owned corporation in sectors such as high-technology industry and energy. However, it could be plainly political reasons as well, as the government could be trying to gain the favour of the workers unions in order to mobilize them for the 1590 presidential election.

Although the announcement had certainly support in some pages on the progressive and left-wing media, it was received in business circles with surprise and criticism.

Minister  Wladyslawa Kolodka has denied that the government is planning any large scale nationalization program. “It has been a concrete measure to solve a concrete problem, and there is no reason to believe otherwise”. She has also declared that the corporate tax is not likely to be raisen in the coming three years”, as it was recently reported in a Mordvanian newspaper. The income and corporate tax was already risen in 1585 and 1587. Kolodka rejected than an isolated decison could threaten to scare off foreign investment.

The measure has been harshly criticized by the opposition, including Aljaz Martelj, the leader of the Mordvanian Republican Party, who denounced it as an “idiotic move, which threatens Mordvanian national interests and economic growth as well”. Even the left-republican Republican Social Radical Party, which is often a supporter of Vladislav Kozina’s government in the Mordvanian parliament critized the decision, although  not in itself, but at least the approach used in taking over the company, without open negotiations, too jarring and chaotic. Although it is not likely that the left-republican party will actively oppose the decision, as if it is likely supported by many of their own voters, Hedvika Novak -who heads the Republican Social Radical Party parliamentary group in the Lower House- has declared their party is likely to oppose any nationalization general policy in the future.