Hongkong International Terminals (HIT) said port operators, contractors and workers — who have reached a settlement in wage negotiations that will give dockworkers a potential increase of 10.1 percent — were “all in the same boat” and would have to work together if the port was to remain competitive.
HIT says 95 percent of contracted dockworkers have signed their agreement to a 6 percent increase from May 1 and an individual productivity-based 4.1 percent incentive, giving them a potential 10.1 percent pay rise.
This is short of the 14 percent increase demanded by the Union of Hong Kong Dockers. Contrary to the HIT announcement, union general secretary Stanley Ho said only 50 percent of the contracted workers had accepted the plan.
According to the South China Morning Post, Ho again refused to rule out the possibility of taking industrial action. He was the organizer of last year’s 40-day strike by the contracted dockworkers, the longest strike in Hong Kong’s history.
The 6 percent increase is higher than last year’s inflation rate of 4.3 percent, and HIT said most of the contracted workers would benefit from the 4.1 percent incentive plan. It pointed out that the incentive program was clear and transparent, with specific methods of calculation for each category of workers, whether they were HIT staff or contracted workers.
The company said it would closely monitor the operations of the external contractors and ensure that workers received the pay increases as agreed upon with employers.
“Under the incentive program to be launched on May 1, over 95 percent of workers who maintain their productivity at the same level as the second half of 2013 and work on their normal shifts will receive an incentive income equivalent to 4.1 percent,” HIT said in a statement.
But the Hong Kong flagship of Hutchison Port Holdings Trust gave a bleak assessment of the port business in its reaction to the agreement on wages.
“The Hong Kong port industry is facing fierce challenges as the Hong Kong port saw an overall drop of 3.6 percent in throughput in 2013 and HIT recorded a decline of 12 percent in throughput, the worst performance since the 2009 financial crisis,” an HIT spokesman said.
“While business is expected to stabilize this year, HIT, external contractors and their workers are all in the same boat and must work together to reinvigorate industry competitiveness. The goal is to attract more business and share the fruits of economic success.”
Those fruits are becoming harder to reach as Hong Kong’s port productivity flags in the face of larger ships staying alongside for longer. Container moves per vessel call are not increasing in proportion with the additional quay space being occupied.
According to data from the JOC Port Productivity database, Hong Kong ranks near the bottom of greater China’s ports in berth productivity, defined as the total number of lifts per hour while the ship is at port. Based on 2013 data for more than 4,300 vessel calls of ships with a capacity of 10,000 TEUs or higher, Hong Kong’s berth productivity was 86 moves per hour, versus 143 at Ningbo, the Chinese port with the highest productivity for vessels of this size.
Hong Kong has now recorded two consecutive years of falling throughput. Last year it handled 22.35 million 20-foot containers, and in 2012, 23.1 million boxes crossed its wharves.