x Abu Dhabi, UAEThursday 18 January 2018

DP World Australian ports hit by strikes

DP World faces several days of industrial action in Australia, as stevedores strike for higher pay and safer working conditions.

DP World has been hit by a series of strikes at four of its Australian ports.

Industrial action began at 7am local time yesterday at the Fremantle and Brisbane ports, and is due to continue in Melbourne today before arriving in Sydney on Saturday. Workers at each port will strike for 24 hours.

Talks broke down between DP World and the Maritime Union of Australia (MUA), which represents 10,000 stevedores and ships' crew members.

Workers are striking for a 5 per cent pay increase and are also objecting to working conditions, which one union official said included "unacceptable safety practices".

After more than 20 meetings, workers began industrial action.

The strikes come as high-profile labour unrest hits many of Australia's companies. Qantas, the country's flag carrier airline, recently grounded its entire fleet in response to industrial action by trade unions representing pilots, engineers and transport workers.

However, strikes planned by the MUA against the country's three major terminal operators could be averted, said Warren Smith, the union's assistant national secretary.

"We've just been able to reach an in-principle agreement with Patrick's - the country's other major terminal operator," he said.

"This shows that when both parties are prepared to sit down and talk constructively, an agreement can be reached. The MUA is always willing to sit down and negotiate in good faith."

DP World declined to comment. The company's London-listed shares fell 1.7 per cent to 670 pence yesterday.

But the industrial action would have only a slight effect on the profitability of DP World, said Kareem Murad, a logistics analyst at Shuaa Capital.

DP World sold a 75 per cent stake in its Australian operations to Citi Infrastructure Investors last year for A$1.5 billion (Dh5.7bn), retaining a 25 per cent stake in the business.

"This is mostly somebody else's problem right now," Mr Murad said. "They manage these ports and it will have a slight impact on [income from] joint ventures and associates, but nothing really major on the top line."