Concrete evidence: French cement giant admits Syria 'unacceptable practices'

Concrete evidence: French cement giant admits Syria 'unacceptable practices'
French cement giant Lafarge said it took part in unacceptable practices at its Syria-based plant, paying protection money to militant groups and defying EU sanctions on Assad regime.
2 min read
02 March, 2017

France - Cement factory

French cement maker LafargeHolcim admitted it had resorted to "unacceptable practices" to continue operations at one of its now-closed factories in Syria, including paying money to armed groups and sanctioned parties for protection.

The admission comes after sources close to the case revealed in January that the French government had filed a legal complaint against Lafarge for buying oil in Syria to power the Jalabiya factory, in violation of international sanctions.

The factory closed down before French cement maker Lafarge merged with Switzerland's Holcim in 2015.

"At times, different armed factions controlled or sought to control the areas around the plant," LafargeHolcim said in a statement following an internal investigation.

"It appears from the investigation that the local company provided funds to third parties to work out arrangements with a number of these armed groups, including sanctioned parties, in order to maintain operations and ensure safe passage of employees and supplies to and from the plant," it said.

"In hindsight, the measures required to continue operations at the plant were unacceptable."

Lafarge is suspected of sourcing oil locally to operate the factory in defiance of a 2012 EU ban

The alleged dealings took place during 2013 when "the deterioration of the political situation in Syria posed very difficult challenges for the security and operations of the plant and its employees", LafargeHolcim said.

The plant, located in northern Syria some 150 kilometres (95 miles) northeast of Aleppo, was finally evacuated in 2014.

Lafarge is suspected of sourcing oil locally to operate the factory in defiance of a 2012 EU ban on purchases of Syrian oil as part of a sanctions package targeting the regime of Syrian President Bashar al-Assad.

The complaint, which was filed in late September 2016, followed a report in French daily Le Monde alleging Lafarge entered into deals with armed groups in Syria, including the Islamic State group, to protect its business interests there, the sources said.

Lafarge bought the Jalabiya cement works in 2007 and the plant went into operation in 2011.

Despite this, the comanpy’s overall sales dropped because of weaker sales in Latin America, the Middle East and Africa, but the group still managed to cut debt by 2.5 billion francs to 14.7 billion.

LafargeHolcim shares rose in response to the report, trading 2.7 percent higher in early business on the Swiss stock exchange.