Unique port conflict can cause irreversible damage

The conflict at APM Terminals in the port of Gothenburg is a unique conflict and have caused negative consequences. That’s the conclusion from Lighthouse postdoctor Marta Gonzalez-Aregall, working at the School of Business, Economics and Law at University of Gothenburg in a report published in June.

Photo credit: Port of Gothenburg

Since the beginning of this year, School of Business, Economics and Law at University of Gothenburg, in collaboration with SSPA Sweden AB, are reviewing the effects of the labour dispute in APM Terminals in Gothenburg. The project consist of several work packages and the final report shall be concluded in September 2019.  In a report, written by Lighthouse postdoctor Marta Gonzalez-Aregall, the conflict and its logistical consequences have been described.
Although conflicts have occurred in other ports in the world, the conflict in the port of Gothenburg goes far beyond of a local conflict, and it presents unique peculiarities.

Marta Gonzalez-Aregall writes:

“First, the Swedish port system differs from other countries’ port management structures because it is connected to the Swedish labor market model. Thus, isolated issues in one specific sector have an effect on the validity of all systems.

Secondly, according to Swedish labor regulations, only one syndicate can have a collective bargaining agreement with the company. However, the regulation allows unions without collective bargaining agreement with their employers go on strike. This issue is a unique Swedish characteristic.

Finally, the importance of this port to the Swedish economy affects its vulnerability and dependency. In contrast, other countries have different port locations in order to diversify their traffic. The specific location of the Port of Gothenburg permits it to be the major port of Scandinavia, but it directly competes with other ports and modes of transport. Consequently, public authorities and private companies can modify their investment plans around the port when a port disruption occurs.”

Long-term logistical consequences
When it comes to the logistical consequences Marta Gonzalez-Aregall writes:

“There is a high risk of the port losing business due to a redirection of freight flows to other ports or land transportation. Consequently, a complex financial performance and distribution networks of manufacturers is expected.

Additionally, the relevance of this specific port to the national economy causes an uncertain situation. Thus, local companies are worried about bankruptcy and late deliveries, while big companies relocate to other areas. Consequently, customers have grown dissatisfied.

From a long-term perspective, there is a real risk of losing jobs and of goods being switched to other modes of transport, which could have national consequences.
The future of this conflict is unpredictable. However, its negative consequences are irreversible. Hence, there could be a possible mirror effect on other Swedish ports and an increase in unnecessary infrastructure investments on other ports or transport modes. Unfortunately, it seems that the existing Swedish regulations are not able to solve this problem. Thus, it may be necessary to face the issues and reform the policies to reflect European Union regulations.”

Read the full report here:
https://gup-server.ub.gu.se/v1/asset_data/207467