London, August 29
Xinhua News Agency reporter Huang Zemin Wang Xiangjiang Zhu Sheng
Due to high inflation and intensified labor disputes, port workers in many European cities recently held Large-scale, prolonged strikes aimed at improving pay and working conditions. Industry insiders said that the strike will exacerbate the already existing congestion at ports under the new crown epidemic, affecting the normal operation of European and even global supply chains.
Since the beginning of this year, the European price level has been rising. In July, the inflation rate in the euro zone reached 8.9% on an annual basis, exceeding market expectations and hitting a new record high.
Sarah Shifflin, an expert in supply chain management at Liverpool John Moores University in the United Kingdom, told Xinhua News Agency that the new crown epidemic and the ensuing global supply chain chaos have pushed up the price. Meanwhile, the pandemic has created labor shortages in parts of Europe, forcing employers to pay higher wages to lure job seekers, leading to higher costs for businesses and higher prices for goods and services. In addition, the Western sanctions against Russia since the beginning of this year have led to an increase in global energy prices, and European countries are more dependent on Russian energy, which has also partially raised the level of inflation.
Soaring prices have led to a relatively rapid decline in people’s real income, which has intensified labor conflicts. More than 1,900 workers at the Port of Felixstowe, Britain’s largest container port, began an eight-day strike on August 21. The organizer, United United Kingdom, said the wage increases proposed by the port operator would not keep pace with price increases.
In mid-August, more than 500 dockers at the Port of Liverpool, another major UK container port, also decided to go on strike to seek pay increases and improved working conditions.
In mid-July, thousands of port workers in Germany held a 48-hour strike, severely disrupting the operation of several container hub ports, including the Port of Hamburg. The strike was triggered by the inability of employers and employees to agree on how to help port workers cope with the soaring cost of living.
Analysts pointed out that frequent strikes may further disrupt the supply chain. Chris Rogers, a supply chain expert at Feixiebo, which operates an international freight forwarding business, recently wrote an article saying that due to the strike at Felixstowe, freighters can only be diverted to other ports in the UK, or even to ports in the Netherlands or France, which may be significant. Affect local industries that rely on international supply chains, and even bring chain reactions to the global logistics network.
Research released recently by data analytics firm The Russell Group shows that strike action at the Port of Felixstowe has the potential to impact $800 million worth of trade, especially apparel and electronic components .
Earlier this year, with high inflation in Europe and workers seeking pay rises, Christian Lelovs, co-founder of Germany’s Esgyy, which provides a container trading platform, said A strike at ports in northern Germany and a massive build-up of containers have exacerbated logistical problems across Europe this summer.
Strikes outside ports are also expected to affect supply chains. Workers at the Dutch railway company have gone on strike recently. In this regard, the Dutch railway company had to cut train frequency and reduce train running time, and it is expected that normal operations will not be resumed until December this year. If labor and management cannot reach a compromise in time, workers will hold a nationwide strike in September.
Experts believe that even if the strike ends, the affected trade activities will not resume immediately. Even if the Port of Felixstowe is operating at full capacity thereafter, it could take 24 days or more to clear the backlog, Rogers said, and it could take up to weeks to get the diverted containers to their intended destinations.
Russell Group general manager Suki Bercy said that due to the huge backlog of goods caused by the new crown epidemic, ports around the world are facing congestion, and the strike may lead to more delays, this The impact will be felt over the next few weeks to months.
Shifflin said the timing of the strike was critical, with many supply chains preparing for the Christmas selling season. Extreme weather, including drought in Europe this summer, has severely impacted supply chains.
Leloves said that once the port fails to operate normally, it will have a significant impact on the efficiency of the container transportation network, and will have a knock-on effect on the upstream and downstream of the supply chain. This year’s port strikes in many parts of Europe have caused great damage to logistics and manufacturing.
Johannes Schlingmeier, the co-founder of Exjet, said that since the outbreak of the epidemic, many major ports in Europe have had efficiency problems. Ocean container logistics and the network of inland barges, trains and trucks it relies on are already under pressure, and the strike will make those problems harder to resolve.