REUTERS - A Chinese construction firm began work on a new privately-owned port in Ashdod on Tuesday, prompting a strike at Haifa docks further up the coast where the workers oppose the new competition.
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Israel's government, looking to break up the monopoly of two state-owned ports in Haifa and Ashdod through which nearly all exports and imports pass, recently approved creating private ports adjacent to the current ones.
The move, it says, will bring down the cost of goods across the board.
A subsidiary of China Harbour Engineering Co is building the 3.3 billion shekel ($876 million) port in Ashdod. A contract for the Haifa port has yet to be awarded.
The new ports will eventually be able to receive the large container ships that presently cannot dock in Israel.
As Prime Minister Benjamin Netanyahu and senior ministers gathered at a groundbreaking ceremony in Ashdod, workers in Haifa left their posts - for the second time this month - complaining that the new competition would hurt their jobs.
They called on the government to reach a deal with unions about any moves it makes in the port sector.
"You have rights," Netanyahu said of the port workers in a speech. "But eight million Israeli citizens also have rights - the right to have competitive, modern, efficient port services."
Netanyahu said the project was a "further expression of the strengthening ties between Israel and China."
The port unions in Israel are known for frequently disrupting operations and a labour court usually orders the workers to return to their jobs within a day.
The Finance Ministry has also announced a three-year privatisation plan for state-owned companies that calls for selling off Ashdod port in 2015 and Haifa port in 2016.