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U.S. ports strike leaves Asia high and dry
From CNN Correspondent Lisa Barron
HONG KONG, China (CNN) -- From car parts to consumer goods, clothing to Christmas toys, much of the cargo aboard the more than 100 ships stranded along the U.S. west coast comes from Asia. And if the labor dispute, which has shut down ports from Seattle to San Diego, is lengthy it could seriously damage the region's burgeoning trade with the United States. Dock workers at 20 west coast ports in the U.S. are locked out in a labor dispute, which has halted all import and export activity indefinitely and is costing billions of dollars. "In the matter of a relatively short time, cargo will just clog up. And in about two weeks after that we'll start to feel the impact here in Hong Kong because the ships are not coming back and that means our pipeline will start to feel the impact," says Erik Bogh Christensen of Modern Terminals. On average, more than 4,300 containers a day move from Hong Kong to the U.S. west coast ports, representing about 80 percent of the shipping volume out of the territory. Shanghai, South Korea and Singapore are also home to shipping companies whose most important route is from Asia to the U.S. west coast. And there is also the threat to imports. Imports threatenedJapan, Taiwan, China and the Philippines are all major buyers of wheat and chilled meat from the United States. Officials in Tokyo and Manila say some shipments have already been delayed. "While alternatives do exist they will be costlier and that will have a negative impact on trade balances if the strike persists for too long," comments Credit Suisse First Boston Chief Economist P.K. Basu. The biggest risk to the entire region though, is the potential impact of the lockout on the U.S. economy -- an estimated $1 billion for every day the west coast ports stay shut. "Every Asian country has significant exports to the U.S.," says Basu. "The U.S. takes between 20 and 24 percent of each Asian country's exports, and any disruptions to that trade would, of course, have a negative impact on Asia." The Asian business community is closely following the progress of negotiations between management and workers in the United States. For now the shippers say the ports will stay shut until the union accepts an extension of its old contract or a completely new agreement is hashed out.
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