Port Strike in Hong Kong

As the Wall Street Journal reports, a strike in the port of Hong Kong among contract dockworkers at the cargo terminals stretched into its seventh day this Wednesday, and the walkout is starting to have a real and increasing effect on the flow of ships and goods on one  of the main transshipment points for consumer goods produced in Southern China. The current strike began March 28, when several hundred subcontracted workers at Hong Kong International Terminals, a unit of  Hutchison Port Holdings Trust.

The workers are demanding a 20 percent pay raise to make up for pay cuts in past years, but subcontractors supplying labor to port operators are only offering 5 percent.

Hutchison International Terminals, controlled by Asia’s richest person Li Ka-shing, operates the terminal where the workers are striking.  The workers want Hutchison to negotiate directly with their union about pay, and better health and safety conditions. However the company has distanced itself from the dispute, saying that the stevedores are not Hutchison employees.

Hong Kong is a major transfer point for goods coming in and out of mainland China. Officials say the action is costing Hutchinson $644,000 a day.

“There are some disruptions, particularly for the importers,” which are seeing some shipments of perishable goods like fruit rot because they’re sitting on the dock longer, said Willy Lin, chairman of the Hong Kong Shippers’ Council.

The Shippers’ Council has advised its members to arrange backup plans in case the strike drags on, including having shipments move through other ports in China, such as nearby Shenzhen.

Please be guided accordingly. RCL Agencies will continue to monitor the situation and report further updates once available