Strike at port over new cargo tariffs

The Malta Chamber of Small and Medium-sized Enterprises (GRTU), which is among the organisations representing cargo hauliers, recently ordered its members to take part in a three-day strike and not to process any cargo containers until matters concerning the introduction of the new tariff regime are clarified. GRTU claims that the introduction of the new tariffs could cause cargo-handling costs to increase sharply. However, other employer organisations criticised GRTU’s actions, stating that its resistance was destabilising for the local economy and harmful for Maltese industry.

Context

The Malta Chamber of Small and Medium-sized Enterprises (GRTU) represents both employers and self-employed persons. When the latter are engaged in work that is remunerated on a commission basis, the organisation acts as a trade union. GRTU, which is among the organisations representing cargo hauliers, recently ordered its stevedores to begin industrial action at the Malta Freeport to protest against the transfer of payment processing offices from Marsa to Birzebbuga and against the new cargo tariff regime announced by the Malta Maritime Authority (MMA).

According to GRTU, the new tariff regime needs further clarification as it would inevitably lead to a significant increase in cargo-handling costs. GRTU stated that it was possible that the costs might escalate by as much as 40% per container for imports and 91% for outbound containers.

Response to strike

As a result, GRTU ordered a three-day strike in July at the Malta Freeport, during which stevedores refused to claim any containers and to pay the new tariffs. Such action reportedly had a negative effect on Maltese industry, with manufacturing companies warning that they were running out of raw materials. Indeed, GRTU’s actions drew fierce criticism from other employer organisations.

The Malta Federation of Industry (FOI) was seriously concerned about GRTU’s position, as the industrial action was deemed to have worsened the local industry, at a time when the Maltese economy is already fragile and when organisations are trying to compete in a difficult international market. The Malta Chamber of Commerce and Enterprise also criticised GRTU’s actions, condemning the union for placing the interests of the few before the common good, and for threatening the national interest.

MMA Chair, Marc Bonello, rebutted GRTU’s claims about the new tariffs and stated that he could not understand the union’s position. Dr Bonello explained that, under the new reform, the role of the shipping agents would change. From now on, shipping agents will only be involved in the shipment of freight and will no longer deal with cargo handling.

Complaint filed with Office of Fair Trade

GRTU also complained about the movement of administrative offices from Marsa to the Freeport headquarters in Birzebbuga, two villages both situated in the south of the island. Port stevedores complained that the relocation will increase their fuel costs. As a result, GRTU filed a complaint with the Office of Fair Trade arguing that ‘as a monopoly, the Freeport cannot act in this way’. Furthermore, GRTU stated that the Freeport was not only challenging the hauliers but also the government.

Government objectives

Further conflicts arose after the government announced that it would widen the system of granting operator licences and that all cargo handlers would have to apply for such a permit, which will be approved according to a candidate’s merit. GRTU argued that, although licences are limited to a set number, this does not make the business a closed shop and it is definitely not a monopoly. Maltese hauliers were mostly frustrated as the government was reneging on a promise it had made prior to the European Union referendum, when it assured hauliers that they would not lose their licences.

Communications and Competitiveness Minister, Censu Galea, assured GRTU and its members that charges would continue to decrease. In fact, Minister Galea reaffirmed the government’s commitment that the ongoing port reform would reduce tariffs. The new cargo-handling contract awarded to the consortium Valletta Gateway Terminals Ltd has committed this organisation to reducing tariffs initially by up to 5%. The consortium will invest MTL 6.7 million (€15.6 million) in the port system over the coming 30 years, and is expected to start with an MTL 5.2 million (€12.1 million) investment in new port infrastructure. The government concluded that it is committed to the port reform and will go ahead with its plans.

Manwel Debono and Christine Farrugia, Centre for Labour Studies