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Hong Kong Strike Clogs Shipping Traffic Hong Kong Strike Clogs Shipping Traffic
(35 minutes later)
HONG KONG — The waters of the South China Sea surrounding Hong Kong have borne an uncommon sight this week: A growing crowd of hulking cargo ships bobbing aimlessly in the haze as their frustrated crews, captains, agents and owners wait for them to be able to come in to port. HONG KONG — The waters of the South China Sea surrounding Hong Kong were the setting for an uncommon sight this week: A growing crowd of hulking cargo ships bobbing aimlessly in the haze as their frustrated crews, captains, agents and owners waited for them to be able to come in to port.
A rare strike among local contract dockworkers at the cargo terminals owned by Li Ka-shing, Asia’s richest man, stretched into its seventh day Wednesday, and the walkout is starting to have a real and increasing effect on the flow of ships and goods on the doorstep of the world’s workshop in southern China. A rare strike among contract dockworkers at the cargo terminals owned by Li Ka-shing, Asia’s richest man, stretched into its seventh day Wednesday, and the walkout is starting to have a real and increasing effect on the flow of ships and goods on the doorstep of the world’s workshop, in southern China.
If the strike drags on, it could affect the peak season for cargo volume at south China ports, which begins in May and lasts until October, as exporters hurry goods to retailers in the United States and Europe to meet holiday season demand. If the strike drags on, it could affect the peak season for cargo volume, which begins in May and lasts until October, as exporters hurry goods from southern Chinese ports to retailers in the United States and Europe to meet holiday season demand.
Although it is better known these days as a global financial center akin to New York or London, Hong Kong still ranks as the world’s third-busiest container port, after Shanghai and Singapore. Despite its higher charges and greater distance from export factories when compared with the mainland ports of southern China, Hong Kong has maintained this position because it has the most frequent connections to the United States, Europe and the rest of Asia and has been — until the past week — one of the most efficient ports in the world, analysts say. Although it is better known these days as a global financial center akin to New York or London, Hong Kong still ranks as the world’s third-busiest container port, after Shanghai and Singapore. Despite its higher charges and slightly greater distance from export factories when compared with the mainland ports of southern China, Hong Kong has maintained this position because it has the most frequent connections to the United States, Europe and the rest of Asia. It also has been — until the past week — one of the most efficient ports in the world, analysts say.
Now, because of the strike, some vessels scheduled to dock at the port are facing delays as long as 60 hours — twenty times as long as the three-hour wait considered normal. Those delays will ripple across the global supply chain, adding to costs as ships are forced to reroute or to skip subsequent ports of call — if and when they decide they can no longer wait out the strike. Now, because of the strike, some vessels scheduled to dock at the port are facing delays as long as 60 hours — 20 times as long as the three-hour wait considered normal. Those delays will ripple across the global supply chain, adding to costs as ships are forced to reroute or to skip subsequent ports of call.
“Most of the cargo comes from China or is destined for China, and the reason people bother to truck goods all the way to or from Hong Kong is because it is more efficient,” said Roberto Giannetta, the secretary of the Hong Kong Liner Shipping Association. Protracted delays, he said, “affect everything down the line.”“Most of the cargo comes from China or is destined for China, and the reason people bother to truck goods all the way to or from Hong Kong is because it is more efficient,” said Roberto Giannetta, the secretary of the Hong Kong Liner Shipping Association. Protracted delays, he said, “affect everything down the line.”
Evergreen Line, a large regional shipping company based in Taiwan, said that as of Wednesday, more than 10 of its vessels had been left waiting for berths in Hong Kong because of the strike. Three or four of those would need to be rerouted to the nearby ports of Shekou in the Chinese province of Guangdong or Khaosiung in southern Taiwan, a company representative said.Evergreen Line, a large regional shipping company based in Taiwan, said that as of Wednesday, more than 10 of its vessels had been left waiting for berths in Hong Kong because of the strike. Three or four of those would need to be rerouted to the nearby ports of Shekou in the Chinese province of Guangdong or Khaosiung in southern Taiwan, a company representative said.
“This is not a good situation at all,” said a senior executive at another major regional shipping company, who declined to be identified, citing the sensitivity of commercial contracts with the port operator. “It is not only Hong Kong. It’s going to hurt everywhere, in a way.”“This is not a good situation at all,” said a senior executive at another major regional shipping company, who declined to be identified, citing the sensitivity of commercial contracts with the port operator. “It is not only Hong Kong. It’s going to hurt everywhere, in a way.”
“The majority of our vessels are waiting for berths right now because we hadn’t expected that this thing would last this long,” he added, estimating his company had 20 vessels floating off Hong Kong, each having to wait at least two days to get into port. “That’s expensive.” “The majority of our vessels are waiting for berths right now because we hadn’t expected that this thing would last this long,” he added, estimating that his company had 20 vessels floating off Hong Kong, each having to wait at least two days to get into port. “That’s expensive.”
The strike itself is notable not just for the effect it is having on commerce, but for having happened at all. Unlike their better organized counterparts in the United States — the longshoremen who won concessions after threatening to close East Coast ports from Massachusetts to Texas in December, or the striking port workers who closed the Los Angeles and Long Beach ports in California for several days in November — unions have historically been weak in the Hong Kong port.The strike itself is notable not just for the effect it is having on commerce, but for having happened at all. Unlike their better organized counterparts in the United States — the longshoremen who won concessions after threatening to close East Coast ports from Massachusetts to Texas in December, or the striking port workers who closed the Los Angeles and Long Beach ports in California for several days in November — unions have historically been weak in the Hong Kong port.
Apart from a 2001 blockade of the main road leading to the port by striking truck drivers that lasted only several days, the last widescale organized labor actions appear to have been during attempted Communist-backed port strikes in the 1960s, when Hong Kong, a British colony at the time, felt the effects of China’s Cultural Revolution. Apart from a 2001 blockade of the main road leading to the port by striking truck drivers that lasted only several days, the last wide-scale organized labor actions appear to have been during attempted Communist-backed port strikes in the 1960s, when Hong Kong, a British colony at the time, felt the effects of China’s Cultural Revolution.
Hong Kong has changed dramatically. A widening wealth gap and soaring housing and other daily living costs have created a sense of disenfranchisement among even middle-class residents, who now take to the streets in protest several times a year, often in the tens of thousands.Hong Kong has changed dramatically. A widening wealth gap and soaring housing and other daily living costs have created a sense of disenfranchisement among even middle-class residents, who now take to the streets in protest several times a year, often in the tens of thousands.
The current strike began March 28, when several hundred subcontracted workers at Hongkong International Terminals — a unit of Mr. Li’s Hutchison Port Holdings Trust, walked off the job to push for a pay raise of around 20 percent from the 55 Hong Kong dollars, or $7, they say they make in average hourly pay. They include workers like Mr. Chen, a 16-year veteran of the dockyard whose job is to verify that his team is loading or unloading the correct shipping container from the correct ship. Mr. Chen, who would only give his surname because he was worried about retribution from the contractor that employs him, said that after several pay cuts, he was worse off than when he started on the job. The current strike began March 28, when several hundred subcontracted workers at Hongkong International Terminals, a unit of Mr. Li’s Hutchison Port Holdings Trust, walked off the job to push for a pay raise of around 20 percent from the 55 Hong Kong dollars, or $7, they say they make in average hourly pay.
They include workers like Mr. Chen, a 16-year veteran of the dockyards whose job is to verify that his team is loading or unloading the correct shipping container from the correct ship. Mr. Chen, who would only give his surname because he was worried about retribution from the contractor that employs him, said that after several pay cuts, he was worse off than when he started on the job.
“The hours are long, and the work can be dangerous at times,” he said. “Counting inflation, I am making less than I did 10 years ago.”“The hours are long, and the work can be dangerous at times,” he said. “Counting inflation, I am making less than I did 10 years ago.”
The organizers of the strike say they have signed up 500 dockworkers from four companies that provide contracted services to the container terminal. In a strategic move, they targeted workers who operate the towering cranes that load and unload shipping containers from cargo vessels. Wong Yu-loy, the organizing secretary of the Union of Hong Kong Dockers, estimates that 200 of the 400 or so crane operators at the Hutchison terminals are on strike. The organizers of the strike say they have signed up 500 dockworkers from four companies that provide contracted services to the container terminal. In a strategic move, they targeted workers who operate the towering cranes that load and unload shipping containers from cargo vessels. Wong Yu-loy, the organizing secretary of the Union of Hong Kong Dockers, estimates that 200 of the 400 or so Hutchison crane operators are on strike.
The resulting slowdown has hit productivity and also the bottom line. Executives at Hutchison’s Hongkong International Terminals — which directly and through a joint venture with China’s Cosco Pacific handles more than half the cargo that passes through the Kwai Tsing Container Port — said the strike is causing it daily losses of 5 million Hong Kong dollars, or $650,000. The resulting slowdown has hit productivity and also the bottom line. Executives at Hutchison — which directly and through a joint venture with China’s Cosco Pacific handles more than half the cargo that passes through the Kwai Tsing Container Port — said the strike is causing it daily losses of 5 million dollars.
Hutchison, listed in Singapore, is the world’s biggest container port operator by cargo volume, with 30,000 staff at 52 ports in 26 countries. In Hong Kong, it operates 16 ship berths at Kwai Tsing, including two through the partnership with Cosco. Hutchison Whampoa, the Hong Kong-listed parent company, is the world’s biggest container port operator by cargo volume, with 30,000 staff at 52 ports in 26 countries. In Hong Kong, it operates 16 ship berths at Kwai Tsing, the city’s main container port, including two through the partnership with Cosco.
It directly employs around 1,800 staff in Hong Kong, and an additional 3,000 subcontractors through a network of companies that provide dockside services — what the company considers “noncore positions,” according to its stock exchange filings. Hutchison directly employs 1,800 staff in Hong Kong, and an additional 3,000 subcontractors through a network of companies that provide dockside services — what the company considers “noncore positions,” according to its stock exchange filings.
Hutchison said in a statement that it had set up a special task force to deal with the striking subcontractors and had activated contingency measures that include “relocating internal resources and manpower to sustain the operation of the terminals.”Hutchison said in a statement that it had set up a special task force to deal with the striking subcontractors and had activated contingency measures that include “relocating internal resources and manpower to sustain the operation of the terminals.”
On Monday, a public holiday in Hong Kong, the Hutchison unit obtained a temporary court injunction; a judge will hear arguments on the matter on Friday. On Monday, a public holiday in Hong Kong, Hutchison obtained a temporary court injunction against the strike; a judge will hear arguments on the matter on Friday. In the meantime, the injunction is forcing the striking workers to relocate outside the terminal’s entrance. There, they continued their protest through intermittent rain on Tuesday and Wednesday, under the shelter of portable canvas tents.
In the meantime, the injunction forced the striking workers to relocate outside the terminal’s entrance. There, they continued their protest through intermittent rain on Tuesday and Wednesday, under the shelter of portable canvas tents. “Some contractors have tried to bully the workers by threatening to fire them if they don’t get back on the job, but it didn’t work,” said Lee Cheuk-yan, a unionist lawmaker in Hong Kong who is helping to organize the walkout. He said the union had raised 650,000 dollars for a strike fund. Workers could be seen lining up to collect cash handouts of 1,000 dollars each on one afternoon earlier this week. “I think things are looking good.”
“Some contractors have tried to bully the workers by threatening to fire them if they don’t get back on the job, but it didn’t work,” said Lee Cheuk-yan, a unionist lawmaker in Hong Kong who is helping to organize the walkout. He said the union had raised 650,000 dollars for a strike fund, and workers could be seen lining up to collect cash handouts of 1,000 dollars each on one afternoon earlier this week. “I think things are looking good.”