The Sepon gold and copper mining project in central Savannakhet is laying off more than 3,000 workers in response to decreasing demand for commodities and falling prices on the global market, according to a provincial official.
The province's Energy and Mines' Department Deputy Director, Mr Phoukhong Nammachak, yesterday said operators of the largest mining project in Laos had met provincial leaders earlier this week to inform them of their plan to lay off the workers.
“They said they would lay off almost all daily contract workers and one third of their permanent staff,” Mr Phoukhong told Vientiane Times.
The project employs about 3,000 daily contract workers and 2,000 permanent staff at the mine, which is located in Vilaboury district, about 300km from the Savannakhet provincial capital.
Mr Phoukhong said most of the workers who would lose their jobs came from Vilaboury district and worked in mine exploration teams. The management had decided to stop expansion of the mining area due to a decline in the global price and demand for copper, he said.
He thought the loss of their jobs would not have a serious impact on most of the workers because many of them were farmers and were self-sufficient. “We advise them to go back to farming until everything is back on track,” he said.
The workers who will be the most affected by the decision are engineers. Mr Phoukhong said these workers were generally younger and did not have any experience in farming or other forms of work.
He said the provincial authorities planned to encourage laid-off workers to find jobs at two sugar processing plants in the province, which required a workforce of more than 5,000 people. But he said few people would apply for these jobs because the factories were too far away. Engineers would not apply for factory jobs because most of the positions required unskilled workers.
Mr Phoukhong said provincial leaders were aware the rise in unemployment might cause economic and social problems.
The provincial Labour and Social Welfare Department will help workers who are laid off to claim compensation from the company, in accordance with the law.
“Officials will familiarise themselves with the legal requirements before asking the company to compensate workers,” he said.
The mine's management has announced they will suspend exploration for new gold and copper mine seams but were not available to confirm the lay-offs.
A reliable source from the mine said the company was forced to fire workers to keep the mine profitable during the global financial crisis.
The price of copper, one of Laos ' main exports, has dropped from US$8,500 a tonne earlier this year to US$2,900 a tonne this week. The production cost of copper is about US$2,600 a tonne.
I've refused the interview in sepon a few years ago, because I knew the gold and copper would over very soon . as far as workers are concerned Many workers will be unemployed after the big projects such as Gold in Sepon and Namthurn 2 project are over....
That has happened because of decreasing demand for commodities and falling prices on the global market.
Yes!! I totally agree with you on that. Laos is finally feeing the effect of U.S./World economy. It doesn't matter how much gold they have in Sepon if nobody is buying.
I thought that quote from Mr. Nammachak was funny as hell. "We advise them to go back to farming until everything is back on track"
What about those people that sold their farms?? It is not like there's another factory jobs out there for them.
i believe now is the time the government should start implementing the building of infrastructure.
i thnk the government should employ ppl by bilding raods, bridgges, etc... this would not only give ppl jobs but increase our infrastructure as well.
Great idea!!!! I've been saying that for years. The government needs to creat some jobs, instead of waiting for other countries to help build bridges, highways and other infrastructures.
