Egypt port strike forces redirection of shipment to Israel
Freezing of operations at Ain Sokhna prompts a local firm shipping Turkish
goods to Saudi Arabia to bypass Egypt, in a further blow to an already
troubled economy
Ahram Online, Sunday 14 Oct 2012
http://english.ahram.org.eg/NewsContent/3/12/55579/Business/Economy/Egypt-port-strike-forces-redirection-of-shipment-t.aspx

A labour strike at the Egyptian port of Ain Sokhna is forcing a local
transit company to ship Turkish goods through Israel instead.

Turkish shipments for Saudi Arabia set to pass through Ain Sokhna will now
use the Israeli port of Haifa and transfer overland, Kadmar, the Egyptian
firm organising the transport, said on Saturday.

Workers at Ain Sokhna port, on the southern edge of the Suez Canal, launched
a full strike on the same day, bringing shipping operations to a standstill.

The Kadmar-handled consignment of frozen food was due to sail from the
southern Turkey port of Iskendrun to Port Said, Egypt, before being moved
overland to Ain Sokhna. From there it would continue by sea to the Saudi
port of Duba.

But suspension of activities at Ain Sokhna means the Turkish ships will now
unload at Haifa, northern Israel, and move goods to Saudi via neighbouring
Jordan, a Kadmar official told Ahram Online.

It is the second change of direction for the shipment, after armed conflict
in Syria forced exporters to find alternatives to their regular overland
route. Anti-Assad rebels seized several Turkey-Syria border crossings in
late July, cutting off a vital regional transit point.

"In August we managed to cut a deal with the Turks to get the shipping route
to pass through Egypt. We had competition from the Israelis but we presented
a better offer," Mohamed Abdel Gawad, head of Kadmar's Suez office told
Ahram Online.

Now it seems the deal is in doubt.

Kadmar sent a statement on Sunday to DP World, Ain Sokhna port's operator,
saying the strike was "damaging" both its company finances and Egypt's
economy as a whole.

The company also indicated that if the freeze continues, the port's deal
with the Turkish exporters might be cancelled.

Kadmar organises five shipments a week between Iskenderun and Port Saud, a
journey that takes around 18 hours.

The deal brings Egypt around LE25 million per week in port, transit and
customs fees, according to Abdel Gawad.

The Ain Sokhna strike entered its second day on Sunday with workers blocking
all entry points to the port, according to several officials contacted by
Ahram Online.

Workers are demanding the reinstatement of eight of their colleagues
dismissed last week, according to Ashraf Eissa, a union representative.

Operator DP World temporarily shut down the port in February during a
five-day stike by workers demanding profit shares and risk allowances.

Several hundred employees staged another partial strike in late June, saying
that management promises had still not been fulfilled.

"The biggest loss is for Egypt," a senior management source said on Sunday,
speaking on condition of anonymity.

"We had plans to expand this shipping route to take Egyptian goods to Saudi
too, and now that will be affected."

Egypt's main port for cargo from the Far East, Ain Sokhna's location at the
southern end of the Suez Canal makes it popular loading point for companies
which use overland routes through Egypt to avoid paying the higher transit
fees for the Suez Canal.

In March, the Suez Canal Authority hiked toll fees for all vessels crossing
the waterway by 3 per cent, saying tariffs had not been changed for the
previous three years.