Arcelor Mittal funds Olympic eyesore

by Corporate Watch / Construction, News / 04 May 2010

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In Spring 2010, London Mayor Boris Johnson unveiled plans for the ‘Olympic Orbit’, a gigantic steel monument that will be built in Stratford to commemorate the 2012 Olympic Games. Designed by Artist Anish Kapoor, along with engineer Cecil Balmond, the Orbit will stand taller than the empire state building in New York and cost £19.1 million to construct. Most of this bill will be covered by the world’s largest steel manufacturers Arcelor Mittal, with the remaining £3.1 million footed by the London Development Agency. But why is this money being used to build a huge steel eyesore, rather than funding real development in one of London’s poorest Boroughs?

According to Arcelor Mittal’s own press release: “the sculpture not only represents a significant cultural investment – the largest single artwork ever commissioned for any Olympiad – but will also make a significant financial contribution to the long-term regeneration of East London.” However, what exactly is meant by long-term regeneration is a highly contestable issue. Olympic ‘development’ in London, as elsewhere, is increasingly seen as a byword for gentrification, displacement and a whole host of other problems. This is due to the negative effects the Olympics have brought to every city they have been hosted in, from the stealing of native indigenous land in Canada to the several deaths in the construction of the Olympics in Athens.

Stratford is an area of serious deprivation, forming part of Newham Council, one of London’s poorest districts. In Newham, 34% of adults have no qualifications, and there are significant health problems with the lowest life expectancy in London and one of the highest rates of TB in the uk. Unemployment in Newham is second highest in England and Wales, with the highest rate of benefit claimants in London. Although the LDA claims that 4,400 new jobs will by created on the Olympic park, there is no guarantee that these jobs will last or match local skills, a scenario already proven in the docklands. Can a corporate vanity project, even of this scale, really effect positive social change in an area with such needs? Or will it simply further exacerbate the increase in housing and living costs that the LDA admits will accompany the Games?

Further questions have been raised about the association of Arcelor Mittal with the 2012 Olympics which have been posited as the “first sustainable Olympic and paralympic games”, a claim that sits uneasily with the company’s egregious environmental record. Other environmentally destructive corporations that are involved with the London Olympics include French multinational GDF Suez, which is contracted to build and run the Olympic Park Energy Centre, supposed to be the flagship of the sustainability claims of the Olympics. GDF Suez is described as “one of the worst and most violent companies in Brazil in terms of its social and environmental record”.

Arcelor Mittal is the largest steel company in the world, and the EU’s 5th biggest polluter, producing 8 percent of world steel output and generating US $65.1 billion revenues in 2009. Despite this wealth, the Orbit’s sponsor has aggressively pursued an anti-environmental agenda, and is responsible for significant opposition to carbon cap and trading schemes.

The European court recently dismissed the second case brought by Mittal against the EU’s ETS scheme. Yet, bizarrely, and despite this opposition, Mittal now stands to make windfall profits by selling permits awarded to them under the ETS programme. According to the carbon trading watchdog Sandbags, Arcelor Mittal is accruing superfluous carbon credits as the quota’s used by the ETS far outstrip actual production, mainly as a result of heavy lobbying from industry (including bodies representing Mittal itself). Thus, it is estimated that, by 2012, Mittal will have around £1 billion worth of credits, the equivalent of Denmark’s entire annual carbon output, all of which it has been awarded for free. It is little wonder then that Arcelor Mittal has spare millions to throw at a project such as the Olympic Orbit.

Arcelor Mittal has also come under fire for negligent safety and environmental practice at numerous operations worldwide, including South Africa, Liberia and notably Kyrgyzstan where around 100 workers have died in accidents in the last 6 years. In the light of this negative image one must ask if it is Arcelor Mittal, rather than the people of Stratford, which stands to gain from the Orbit project, building positive PR for the company without having to reduce the damaging impact of its business practice. Whilst Mittal will continue to pollute and profit long after the Games are forgotten, will the Orbit be destined to end up as useless as the Millennium Dome or as expensive as the London Eye?