Environment

Italy's Jobs-and-Pollution Showdown


A screen erected by the Ilva steelworks in a vain attempt to filter out pollution

Photograph by Guy Martin/Panos

A screen erected by the Ilva steelworks in a vain attempt to filter out pollution

The southern Italian city of Taranto’s most distinctive feature isn’t its picturesque coastline, its cathedral, or its castle. It’s the heavy taste of metal in the air—a tang that leaves the unaccustomed visitor with a tingle in the back of the throat, the product of the Ilva steelworks. On one side of the bay stretch manicured sidewalks and coffee shops. On the other loom giant cranes and a forest of chimneys pumping smoke.

Ilva, the largest steel plant in Europe, has set off a conflict in the city of 190,000 between those worried about their health and those desperate to keep their jobs. It’s also put Italy’s government on a collision course with its judiciary, which wants the plant closed.

Over the past decade, environmentalists have exposed alarming levels of pollutants in the area around the plant. In 2008 roughly 2,000 sheep were slaughtered after their milk and meat were found to contain dangerous levels of dioxin. In the blue-collar neighborhood of Tamburi, on the same side of the bay as the plant, homes are infiltrated by a black powder that blows from slag heaps and drifts from smokestacks. Grazia Parisi, a pediatrician who once worked in the area, recalls finding the powder on her desk and examination bed every morning. “I was always washing my hands, washing my hands,” she says. “I left because I was also getting sick.”

Parisi says some 90 percent of the babies in the area suffer asthma attacks in their first year. Tests in 2010 revealed that the soil in Tamburi contained high levels of beryllium, lead, and polychlorinated biphenyl. The mayor issued an order forbidding children from playing on unpaved lots. In February 2011, another dioxin and PCB scare prompted a ban on oyster farming near the plant.

Ilva accounts for 30 percent of Italy’s steel production and some 12,000 jobs in a city where unemployment has reached 33 percent. A division of the privately held Gruppo Riva, Ilva claims to generate 75 percent of the province of Taranto’s gross domestic product. The port is almost completely dedicated to shipping Ilva’s steel. “If it were so easy to find opportunities elsewhere, do you think we’d still be here?” asks Vito Bilotta, an official at UILM, a union fighting to keep the plant open. The extent of Ilva’s grip on the city can be seen at the main church in Tamburi, where a mosaic shows a blond Jesus with smokestacks and cranes in the background.

The conflict came to a head in July, when a magistrate ordered the seizure of parts of the plant. Eight managers and ex-managers, including owner Emilio Riva, were placed under precautionary house arrest while being investigated on suspicions of knowingly and negligently causing an environmental disaster. The company disputes responsibility for health risks in the region.

Since then, protests have occurred—by residents seeking to shut the plant and workers terrified of losing their jobs. According to Bilotta, the standoff is undermining the confidence of Ilva’s customers. Some 800 workers have been put on temporary leave due to market conditions, and banks have started refusing loans to Ilva workers.

In October, the Italian National Health Service reported that residents of Taranto are 30 percent more likely to develop tumors than neighbors in the surrounding province. In the case of lung cancer for men and stomach cancer for women, the risk is doubled. A child in Taranto is 20 percent more likely to die in the first year of life than one in the rest of the region. “It’s like an iceberg,” says Patrizio Mazza, a doctor who has long been raising the alarm. “We’re only seeing the tip.”

On Nov. 26 prosecutors ordered another investigation, this time into allegations that Gruppo Riva managers bribed local officials so the plant could keep polluting. They also seized steel products from a ship in port. In protest, the company announced it would cease production. Thousands of workers rushed the gates, demanding to return to work.

Prime Minister Mario Monti’s government put through an emergency decree on Nov. 30, reversing the closure of part of the plant that was ordered earlier by the court. The decree also said Ilva could keep operating while Rome oversaw a €3 billion ($3.9 billion) overhaul to make it compliant with European Union standards. For those seeking to shut down the plant, Monti’s move was a shock. Says Parisi: “It’s as if you had a sick person in front of you, and instead of curing him, you give him a kick.”

With European steel suffering and Italy’s economy weak, money for improvements may come slowly. Politics could get in the way, too. On Dec. 8, Monti announced he would step down to make way for early elections. The measure regarding the plant is one of many announced but not yet ratified by Parliament. Taranto runs the risk of being forgotten once again.

The bottom line: The Ilva steelworks needs a $3.9 billion overhaul. Given the recession and Italy’s political turmoil, the money may never come.

Faris is a Bloomberg Businessweek contributor.

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