The open wound of Larco

For one more year, the fourth in a row, the Larco state mining company will remain idle, but subsidized by the state budget. This is despite the fact that the relevant tender for its sale and the entry of a strategic investor has already been completed since last year and the demand for nickel internationally is strong.

Larco is a problematic enterprise that has cost Greek taxpayers 5.77 billion euros, according to a recent study.

The new extension means that in addition to the financial burden, which is in the order of €1.5 million per month for the payment of fixed-term contracts to the approximately 900 workers (who have been fired and compensated since last year, but continue to be employed without purpose, since the company no longer produces anything), the state will probably continue to pay the fines imposed by the European Court of Justice for the non-recovery of state subsidies to Larco.

Now, with the announcement of the general elections anticipated in the next few weeks, the Finance Ministry has passed a regulation in a bill that provides for yet another extension of the Special Administration, this time being more generous, until February 7, 2024.

The ministry justified its decision by citing the time it claims it requires in order to “complete the disposal of the assets of Larco and of the Greek state to the investor that has emerged after the successful completion of the two parallel tender procedures carried out by the Special Administration and by TAIPED,” the latter being the state asset utilization fund.

In addition, the ministry has extended the possibility of concluding fixed-term employment contracts with the company’s employees until the end of 2023.

While workers will be paid without working, as the industry has long been closed, market circles discern significant lost revenue from the fact that the investors’ business plan to gradually ramp up ferronickel and nickel sulfate production to 20,000 tons per year is not progressing.