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.
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.
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.
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.
“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.
“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 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.
Article source: http://www.nytimes.com/2013/04/04/business/global/hong-kong-strike-clogs-shipping-traffic.html?partner=rss&emc=rss