DHL scraps thousands of jobs in Belgium

DHL workers immediately went on strike to protest against the loss of about 1,700 jobs, instead of the thousands more that they had been promised under the company's planned expansion of its hub in the Belgian capital.

"We had a vision of making Brussels national airport the most modern and state-of-the-art hub of global logistics network," said DHL Express Europe chief executive Peter Kruse.

"However, we have now reached the point where we realise that there is no political support."

However, Prime Minister Guy Verhofstadt said that the talks had finally broken down because DHL kept on adding "additional conditions, additional planes, more flights. Of course, they made it impossible."

A month of negotiations between the company and national and regional authorities failed over the number of intercontinental night flights that the company wanted to land at the airport just outside the city, disrupting the sleep of thousands of local residents.

"We cannot accept that a company disregards environmental and citizens' concerns in such a way," said Belgian Vice-Premier Laurette Onkelinx.

The company announced its decision to unions early yesterday. Workers reacted by going on strike and briefly blocking the ring road around the capital.

"At first, everybody was talking about expansion and now we are shrinking," said union spokesman Johan Lievens. DHL has almost 3,000 workers at Brussels airport.

DHL will move its intercontinental hub in 2008 either to Leipzig, Germany, or Vatry, France, leaving Brussels as only a regional hub, the company said.

Aircraft noise is a sensitive issue and the regional governments of Brussels and northern Flanders objected to increasing night flights over the capital region.

Unions fear that the departure of DHL could prompt other companies that rely on its operations to leave as well.

For the past month, Mr Verhofstadt's liberal-socialist government had made the expansion of DHL one of its prime objectives.

The government teetered on the brink of a crisis two weeks ago as the ruling parties were caught between the interests of trade unions, residents and businesses.

Neighbourhood committees around the airport on the northern edge of Brussels say that the relentless noise at night would have pushed up medical spending by 250 million euros (£180 million) annually had DHL expanded its operations.