SYDNEY // The Dubai ports operator DP World is to lock union workers out of its Melbourne container port in Australia next week in response to a 24-hour strike called for Sunday.
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The two-day closure of the Swanson Dock in Melbourne, Australia's busiest container port, is expected to affect about 16 ships transporting some 20,000 containers for import and export.
The move signals a significant escalation in an eight-month dispute over pay and conditions at DP World's five terminals in Australia, located in Brisbane, Sydney, Fremantle, Adelaide and Melbourne.
The Maritime Union of Australia (MUA) is asking for a 15 per cent increase in wages over three years for the 2,000 employees at the five terminals, but DP World says any wage increase over and above the rate of inflation should be linked to performance and productivity improvements. It has said the union demands would add about US$60 million (Dh220.3m) to costs.
The threat to lock 600 workers out of its Melbourne facility comes just days after DP World locked 140 workers out of its Adelaide terminal in response to rolling stoppages and industrial action at that port. The union is also pushing for a greater number of casual employees to be given permanent employment.
"In response to the 24-hour industrial stoppage taken by members of the MUA in Melbourne, DP World has now taken protected action of locking out employees at our container terminal in Melbourne for 24 hours from 22.31 Monday 9 January to 22.30hrs 10 January 2012," said Andrew Adam, the DP World Australia national director of operations.
DP World raised $1.5bn in December 2010 by selling a majority stake in its Australian unit to Citi Infrastructure, a unit of Citigroup, and one other party. DP World now holds a 25 per cent share in DP World Australia but retains a key presence in the business through a services and management agreement.
Relations have deteriorated rapidly since talks broke down last month. The dispute is part of a wider escalation of industrial action and stoppages in recent months in Australia. The increasing use of lockouts by companies such as Qantas Airways and Cadbury Schweppes in response to union action has in turn put pressure on the Labor government over the Fair Work Act, which is unpopular with many business groups that argue it is ineffective in resolving disputes.
The use of lockouts as a key negotiating tool has also raised fears of a repeat of the bitter dispute in 1998 between the MUA and Patrick Stevedores company, when Patrick locked out its workers and replaced them with non-union labour. Chris Corrigan, who was then the chief executive of Patrick Corporation, is now the chairman of POAGS, which chose to lock workers out of three of its terminals last month in response to its own dispute with workers over pay and conditions.
That dispute ended after the intervention of the government. However, Bill Shorten, the federal workplace relations minister, said yesterday that he did not intend to intervene in the dispute between the MUA and DP World, at least until the negotiating process had been exhausted.
"I'm not going to micromanage every negotiation that goes on," Mr Shorten told ABC Radio. He said both parties had strongly-held positions but both had advised that the negotiations had not been exhausted. "At this stage, no one's indicating any desire for arbitration," he said.
The company and Paddy Crumlin, the MUA national secretary, are scheduled to meet in Melbourne today, The Australian Financial Review (AFR) reported yesterday. "We are pretty much at the pointy end of the agreement and we are hopeful to be able to work through them and have no further action," Warren Smith, the MUA assistant national secretary, told the AFR.
tarnold@thenational.ae
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Some of Darwish's last words
"They see their tomorrows slipping out of their reach. And though it seems to them that everything outside this reality is heaven, yet they do not want to go to that heaven. They stay, because they are afflicted with hope." - Mahmoud Darwish, to attendees of the Palestine Festival of Literature, 2008
His life in brief: Born in a village near Galilee, he lived in exile for most of his life and started writing poetry after high school. He was arrested several times by Israel for what were deemed to be inciteful poems. Most of his work focused on the love and yearning for his homeland, and he was regarded the Palestinian poet of resistance. Over the course of his life, he published more than 30 poetry collections and books of prose, with his work translated into more than 20 languages. Many of his poems were set to music by Arab composers, most significantly Marcel Khalife. Darwish died on August 9, 2008 after undergoing heart surgery in the United States. He was later buried in Ramallah where a shrine was erected in his honour.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Where to Find Me by Alba Arikha
Alma Books
