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14 I Companies & Markets bne December 2017
related to the environment,” he tells bne IntelliNews.
ArcelorMittal is also struggling to boost its stake in the nearby Prijedor mine, which has been the main supplier to the steel mill in Zenica for decades. Alongside the acquisition of Zenica in 2004, ArcelorMittal bought 51% of the company then named Iron ore mines Ljubija. This company today operates under the name ArcelorMittal Prijedor, and exports iron to other ArcelorMittal companies.
The international steelmaker now wants to increase its stake in the Prijedor mine, where the remaining 49% is owned by the government of Republika Srpska, even though Zenica is located in the Bosnian Federation, the country’s larger entity. Taking greater control of the company would ensure a source of iron ore for Zenica’s unit.
However, the Republika Srpska government’s attempt to sell over 60% of its 49% stake in Prijedor this spring failed due insufficient political consent and has now been put on hold. It’s not clear what the entity’s government plans to do now.
“We are struggling to find solutions for Prijedor because Prijedor and Zenica are married, not by ArcelorMittal but by history,” says Nair. “Now, we need to develop new mines there so ArcelorMittal is looking forward to a very good engagement with the government of Republika Srpksa to find a solution
to develop it and go further.” He stresses the benefit of having an iron ore mine virtually on the steel plant’s doorstep: “if Prijedor mine produces iron and it is used in Zenica, it gets value but if you transfer it more than 500km, it loses value. We need to continue this marriage.”
Despite the challenges, however, ArcelorMittal is committed to staying in Bosnia and in the region, with Nair being very passionate about his work there. Having already spent 14 years and millions of euros, ArcelorMittal wants to see its business grow along with the town of Zenica.
“We stay here, we invest here... Our goal is to stay within the ex-Yugoslavia and from [Bosnia] go to Serbia, Slovenia, Croatia...” he concludes.
Turkish lira remains under strain as Pence-Yildirim tête-à-tête produces little
Will Conroy in Prague
The Turkish lira (TRY) remained under pressure on November 10 as the much hyped Washington, DC meeting between Turkish Prime Minister Binali Yildirim and US Vice President Mike Pence did not immediately produce much by way of resolving tensions over an outbreak of issues straining bilateral relations.
Since 11 October, the TRY has slid from 3.63/USD to 3.87/USD, with analysts considering that the psychologically important 4.00/USD mark might not be far away if Turkey’s inflationary and other various economic problems continue to mount up and the relationship with the US either goes unrepaired or deterio- rates. Ahead of the Yildirim-Pence tête-à-tête, foreign buying
of Turkish local-currency government bonds had slowed to a trickle, a big concern for Ankara given that the Turks are depen- dent on portfolio inflows to help finance a current account deficit which the International Monetary Fund forecasts will expand to 4.6% of GDP this year, from 3.8% last year.
Pence and Yildirim did not even hold a press conference after emerging from their relatively short meeting on November
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9 though efforts were made by officials from both sides afterwards to put as positive a spin on relations as possible.
The hoped for full restoration of visa processing – first the US, then Turkey in retaliation, suspended such visa services for the other side’s nationals after the early October arrest of a worker of the American embassy in Ankara over his alleged links to US-based self-exiled cleric Fethullah Gulen, blamed for the failed coup of last year, and on charges of espionage – did not materialise from the clear the air session.
There was also no sign of the US agreeing to consider extradit- ing Pennsylvania-resident Gulen nor of Turkey agreeing to free American evangelical pastor Andrew C. Brunson, arrested as part of ongoing mass purges of suspected Gulenists that have taken place under the country’s 17-month long state of emer- gency introduced following the botched putsch. Neither was there any indication of Nato member Turkey signing up to buy the US Patriot missile defence system in place of a deal for Rus- sia’s S-400 hardware which may be moving towards comple- tion, though some sceptical experts doubt it will go through.