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Company chairman Wang Zhikui said the job cut was a measure adopted to "stop bleeding" the company. It also plans to sell its non-coal related businesses to help pay off its debts, Wang said. (Image for representation)
BEIJING: A coal company announced the biggest layoff seen in China in recent years as it is set to relieve 100,000 workers accounting for 40% of its labour force.
The announcement came in the midst of Chinese president Xi Jinping's ongoing tour to the United States, where he assured politicians and businessmen that China's economy will achieve the targeted 7% growth in gross domestic product.
Much of China's clout in the US is based on its economic achievements in past years. But the Chinese economy has slid from the earlier 10% growth level to the present situation where it is struggling to achieve 7%.
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Heilongjiang Longmay Mining Holding Group Co Ltd. said it was taking action to reduce recurring losses, and will bring about the labour cut in the next three months. It has 240,000 workers on the rolls at present.
Company chairman Wang Zhikui said the job cut was a measure adopted to "stop bleeding" the company. It also plans to sell its non-coal related businesses to help pay off its debts, Wang said.
"Personnel is probably its largest cost," the State media quoted Deng Shun, an analyst at Shanghai-based energy consultancy ICIS C1 Energy, as saying. "Actually many traditional State-owned coal enterprises are facing the same kind of problem. It has become more severe as the industry remains on a downward trend," Deng said.
