September 28, 2017 / 6:43 PM / 3 months ago

Argentina's Macri forces dock workers to agree to competitive bidding

BUENOS AIRES (Reuters) - Argentina’s government has pushed dock workers at the country’s all-important Rosario grains export hub to win contracts by way of competitive bidding as it tries to lower business costs and encourage investment, officials said.

President Mauricio Macri, a free-markets proponent elected in late 2015 on promises of increasing investment in Latin America’s No. 3 economy, has ended longstanding trade and currency controls, as well as many policies that favored unions under the previous administration.

Rosario is the dispatch point for the soy, corn and wheat produced in Argentina’s vast Pampas farm belt. The country is the world’s top exporter of soymeal livestock feed, as well as a major supplier of corn, wheat and raw soybeans.

Competitive bidding for loading and unloading contracts should lower the cost of exporting food from Argentina. But there has been stiff resistance from unions, which say Macri is governing for the rich while reducing wages for working people.

The Rosario grains hub, on the banks of the Parana River, accounts for 80 percent of grains and derivative products that companies like Cargill and Bunge ship.

The push toward competitive bidding is being carried out simultaneously with investigations of alleged irregularities committed by trade unions, which have weakened their bargaining positions. A construction union leader was arrested this week on accusations of extortion and money laundering.

An overview of the port of Rosario, Argentina, on the shore of the Parana river, January 16, 2016. Picture taken January 16, 2016. REUTERS/Marcos Brindicci

“The Port Workers Cooperative accepted the terms that the state had imposed on them,” Jorge Metz, national undersecretary of Ports and Waterways, said in a telephone interview.

Herme Juarez, president of the Cooperative and secretary general of the San Lorenzo United Port Workers’ Union (SUPA), whose workers are employed by the company he runs, could not be reached for comment.

An overview of the port of Rosario, Argentina, on the shore of the Parana river, January 16, 2016. Picture taken January 16, 2016. REUTERS/Marcos Brindicci

Daniel Badia, a manager of the stevedore Cooperative, said representatives of the Cooperative and the export companies are in negotiations. Deadlocked talks in the past have shut down port operations, delaying food exports due to long strikes that have cost export companies millions in losses.

Among those at the negotiating table with Metz and Juarez are representatives of the Chamber of Private Commercial Ports (CPPC), which told Reuters that in the coming days, contracts for companies with stevedore services, previously dominated by the Cooperative, will be up for bidding.

“We are going to invite different stowage companies to make an offer of services and prices. The only way to have competitive costs is through a transparent and competitive market,” said Martin Brindici, general manager of CPPC.

Brindici declined to give details on which firms would be invited to the private tender, but Metz said between six and seven firms, including the Juarez cooperative, are interested.

The Buenos Aires Cereal Exchange expects that the combined soybean and maize crops will add about 95 million tons in the 2017/2018 cycle, which will mostly be shipped from Rosario.

Additional reporting by Nicolas Misculin; writing by Hugh Bronstein; Editing by Dan Grebler

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