Strike Hits Irish Smelter

Labor unrest threatens the future of Ireland's largest foreign, investment, a $750 million alumina refinery owned by three major multinationals. Late in April, construction at the Alumina Contractors site-owned 40 percent by Canada's Alcan Aluminum Corp., 35 percent by Royal Dutch Shell and 25 percent by the U.S. firm Anaconda-came to a stand-still when a group of workers walked out in a dispute over bonus payments. After the wildcat strike, company officials announced they were "suspending construction until further notice," and work has yet to resume on the less-than-half-finished facility.

Since its admission to the European Economic Community (EEC) in 1973, Ireland has aggressively courted foreign corporations. With lenient taxation policies, corporate subsidy programs and a low-wage labor force, Ireland has become a major center for multinational corporate activity. U.S. investment totals over $1.6 billion, and U.S. firms provide 25 percent of all jobs in the country's manufacturing sector.

A consistent thorn in the side of foreign corporations, however, has been, the country's restless labor force. Strikes claimed over 500,000 man-days in 1978, up 15 percent from a year earlier. Labor relations broke down nearly completely in 1979, as unions throughout Ireland spurned government efforts to develop a "national accord" on wages.

Trade union leaders complain that Ireland's industrialization strategy-promoting job creation through generous incentives to foreign investors-unfairly shifts the tax burden to citizens and consumers, and emphasizes investments in infrastructure over basic social services.

Under current statutes, for example, foreign investors pay no taxes on profits earned from exports. Since U.S. corporations export about two-thirds of their production in Ireland (with 50 percent going to other EEC nations) and are permitted generous write-offs for capital outlays by the Irish government, most U.S. firms face an effective tax rate of zero.

Given its commitment to foreign investment, the Irish government is worried about the Alumina Contractors dispute. According to David O'Sullivan, an official with the country's Industrial Development Authority (IDA), Irish -authorities have become "directly involved" in talks between the company and its 2000 construction workers.

Alcan spokesman Cary Kirkman stresses that Alumina . Contractors "intends to resolve the situation and continue construction," although he does not expect a speedy settlement. O'Sullivan, for his part, is anxious to insure foreign investors that the strike does not indicate popular dissatisfaction with the role of foreign firms in the country. "The simple reality is that all trade unions in Ireland welcome foreign investment."