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Spanish docker strike seen disrupting key export chains

Source: Reuters - Thu 9th Feb 2017
Spanish docker strike seen disrupting key export chains

Key export chains in Spain could face major disruption if a long-running dispute between the government and the country's dock workers extends beyond a planned three-day strike next week, industry sources warned on Thursday.

The standstill will take place every other hour on Feb. 20, 22 and 24 at dozens of Spanish ports which employ more than 6,000 stevedores and handle an estimated 500 million tonnes of merchandise a year.

"The strike action could cause a lot of problems, not only for the ports but also for the companies," said an administrative source at the busy Mediterranean port of Valencia, who spoke on condition of anonymity.

Spain's export sector is worth more than EU330 Bln a year, or about a third of economic output. Some two thirds of those exports pass through the country's ports.

The strike will be especially painful for the automobile industry, given that Spain is the second largest car manufacturer in Europe. More than 80 percent of the approximately 7,800 vehicles produced every day are sent abroad.

Volkswagen's Spanish unit Seat, which exports some 170,000 cars a year through the port of Barcelona, said the company had already begun to clear room to store vehicles it would be unable to ship during the strike period.

"If the strike lasts just three days, you need to plan ahead but it won't cause too many delays," a spokesman for the company said.

A longer dispute could be problematic and paralyse production lines as imported vehicle parts are held up in unloaded ships.

SECTOR REFORM

The strike was called after the Spanish government announced plans to reform the sector that were unpopular with the unions. The overhaul would allow companies to hire their own personnel instead of unionised staff, who earn 70,000 euros per year on average according to a PriceWaterhouseCooper study.

The proposals aim to bring Spanish regulations into line with the rest of Europe. Spain has had to pay about 27,000 euros a day in fines since 2014 due to its failure to reform the system in line with European Union requirements, a government source said.

The fines could more than quadruple if the reforms are not implemented quickly as the EU punishes Spain for delays, the source said.

However, unions say the planned reform rips up the rules that govern Spanish ports and protect workers.

"The Spanish government is tearing up the rule book with a callous disregard for Spanish jobs, Spanish prestige and international conventions. Their plans are beyond belief," a docker representative at the International Transport Workers' Federation, Paddy Crumlin, said in a statement.

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