Cargo traffic in the Serb Republic has been cut by 70 percent since Monday after railway workers went on strike over unpaid wages. They threaten to bring traffic to a halt unless the region's government settles the debt by Friday.
Iron ore miner ArcelorMittal Prijedor in northwestern Bosnia, owned by steel giant ArcelorMittal , said the strike had put its work in jeopardy and cut 80 percent of iron ore supplies for its top consumer, steel maker ArcelorMittal Zenica.
Bosnia's sole alumina plant Birac said KAP, the only aluminium smelter in neighbouring Montenegro, the major consumer of its alumina, was running out of feedstock and may be forced to halt output -- having already halved it -- unless it gets supplies.
"This would be a catastrophe both for KAP and Birac, since we would have to compensate the damage," said Virginijus Vajega, the acting general manager of Birac, which is majority owned by Lithuania's Ukio Bank Investment Group .
Global Ispat Coke Industry Lukavac (GIKIL), based in the northern town of Tuzla, said it was forced to cut output by half because it receives only 1,100 tonnes of coal a day, when it requires twice that amount.
Construction firm Sirbegovic has also been affected and has appealed to the striking board of the Serb Republic Railways Company to allow the transport of 125,000 tons of concrete products intended for its projects in Croatia.
The Serb Republic railway strike comes less then two months after its counterparts in Bosnia's other autonomous half, the Muslim-Croat federation, halted traffic over suspension of engine drivers and changes to a collective bargaining deal.
The region's government did not agree on conditions set by railway workers, including the payment of 21 million marka ($14.6 million) in outstanding wages. Assistant Transport Minister Marinko Biljanovic said the issue would be discussed at the next cabinet session.
The government insisted that traffic be kept at minimum capacity until a solution is found. (Reuters)
