Manufacturers could lose NIS 1b. a day

July 25, 2007 00:28
3 minute read.

The Histadrut Labor Federation's general strike set to start on Wednesday morning will cause almost NIS 1 billion in losses a day to the country's manufacturers, industry leaders said on Tuesday. "If this strike lasts seven or eight days, manufacturing companies could be looking at losses of some NIS 7b.," said Uriel Lynn, president of the Federation of Israeli Chambers of Commerce. "Not only will they suffer from severe direct losses, but there will also be significant long-term repercussions on production levels as raw materials needed for manufacturing are not going to be able to come into the country." Manufacturers Association of Israel President Shraga Brosh met separately on Tuesday with Histadrut Chairman Ofer Eini and Finance Minister Ronnie Bar-On in an effort to avoid the strike. Ahead of the meetings, he expressed confidence the labor action could be avoided. "I am going to do everything in my power to prevent the strike. I will talk with both parties with the intention of averting this strike, which would cause tremendous damage to the Israeli economy. The business sector and the economy cannot afford so much as an hour of strike," he said. Following the meetings, the Manufacturers Association said that nothing was certain, other than the fact that neither the Manufacturers nor the Histadrut wanted a strike. "We are still hoping to avoid the strike," said the Association, reporting no new developments coming out of Brosh's meetings. Brosh also noted that the strike would cause disruptions in electricity and fuel supplies, as well as a slow down in imports of raw materials due to the closure of the ports, which would shut down manufacturing lines. This, in turn, he said, was likely to delay exports, which would require manufacturers to compensate customers. Relations with export customers have already been strained this year, as workers at the Ashdod Port went on strike in February to protest working conditions and again in March over disagreements surrounding the awarding of outsourcing contracts, a strike that cost exporters some NIS 40 million a day and stranded an estimated $90m. worth of goods on ships outside the port and on docks waiting to be loaded. A general strike would be much more damaging to exporters. "We are looking at losses of some $100m. on the first day of the strike, and should the strike continue for five days, I estimate that it will cost our country's importers and exporters a combined $250m.," said David Artzi, chairman of the Israel Export Institute. "Even if they call a strike for one day, it's not really one day," he said. "One day of striking leads to three days of no movement in or out of the ports as it takes time, and significant money, to restart all of the country's port operations." According to Lynn, the Federation of Israeli Chambers of Commerce has asked the National Labor Court to issue an injunction against the planned strike. He added that while he did not oppose the right to strike, he objected to what he called a "solidarity strike." "This strike should not include workers who are employed at nongovernment-related places of work, public health employees, basic services employees such as electric and water, and also places where employees already enjoy high salaries, such as at the airports and seaports," he said. In addition to substantial financial damage, a strike by seaport employees would undo the hard work that export companies have done to built relationships with overseas customers, said Lynn. "The time that has been invested in building trust with customers will be totally gone, and to regain this trust is something very difficult to do," he said. The Manufacturers' Association told The Jerusalem Post that, ahead of the potential strike, manufacturers were conducting business as usual. "Export levels have not increased over the past couple of days from companies looking to ship products before the strike begins," said the Association. "There is nothing that we can do," Artzi said. "This strike is going to be very damaging not only to the export industry, but to the entire economy and many people are going to suffer as a result of it."

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