[1/5]Union members with the International Longshore and Warehouse Union Canada (ILWU) remove strike signs from a picket line outside the despatch hall in Vancouver, British Columbia, Canada July 13, 2023. REUTERS/Chris Helgren
VANCOUVER, British Columbia, July 13 (Reuters) – Dock workers at ports along Canada’s Pacific coast and their employers accepted a tentative wage deal on Thursday, ending a 13-day strike that disrupted trade at the country’s busiest ports and risked worsening inflation.
“The British Columbia Maritime Employers Association (BCMEA) and International Longshore and Warehouse Union (ILWU) Canada are pleased to advise that the parties have reached a tentative agreement on a new 4-year deal,” the BCMEA said in a statement.
The ILWU also said there was an agreement, which must now be ratified by both sides. The union had made demands including wage increases and expansion of their jurisdiction to regular maintenance work on terminals.
Some 7,500 dock workers represented by the ILWU walked off the job on July 1 after failing to reach a new work contract with the BCMEA representing the companies involved.
The strike upended operations at two of Canada’s three busiest ports, the Port of Vancouver and the Port of Prince Rupert – key gateways for exporting the country’s natural resources and commodities and bringing in raw materials.
Economists have warned that the strike could trigger more supply-chain disruptions and fuel inflation while the Bank of Canada tries to cool the economy.
“The scale of the disruption has been significant,” Labour Minister Seamus O’Regan and Transport Minister Omar Alghabra said in a joint statement.
“We do not want to be back here again. Deals like this, made between parties at the collective bargaining table, are the best way to prevent that.”
On Tuesday, O’Regan said the differences between the parties were not sufficient to justify a continued work stoppage.
He offered terms drafted by a federal mediator and gave the union and employers 24 hours to decide if they were satisfied. The deal was reached at 10:20 am PT (1720 GMT), 10 minutes before the deadline, the ILWU said.
The parties, with help from federal mediators, had been negotiating a new contract since late April.
More than half of Canadian small business owners in a survey released on Tuesday said the strike at the Port of Vancouver will affect their operations, according to preliminary results from the Canadian Federation of Independent Business.
The strike is estimated to have disrupted C$6.5 billion of cargo movement at the ports, based on the industry body Canadian Manufacturers & Exporters’ calculation of about C$500 million in disrupted trade each day.
Reporting by Ismail Shakil and Steve Scherer in Ottawa, editing by Deepa Babington, Alexandra Hudson
TORNIO, Finland/KARLSKRONA, Sweden, July 3 (Reuters) – High above a railway bridge spanning a foaming river just outside the Arctic Circle, Finnish construction workers hammer away at a project that will smooth the connections from NATO’s Atlantic coastline in Norway to its new border with Russia.
“We will be removing some 1,200 of these one by one,” says site manager Mika Hakkarainen, holding up a rivet.
Until February 2022, the 37-million euro ($41 million) electrification of this short stretch of rail – the only rail link between Sweden and Finland – simply promised locals a chance to catch a night train down to the bright lights of Stockholm.
After Russia invaded Ukraine, that changed.
Now Finland is part of NATO, and Sweden hopes to join soon.
As the alliance reshapes its strategy in response to Russia’s campaign, access to these new territories and their infrastructure opens ways for allies to watch and contain Moscow, and an unprecedented chance to treat the whole of northwest Europe as one bloc, nearly two dozen diplomats and military and security experts told Reuters.
“PUT RUSSIA AT RISK”
The Finnish rail improvements around Tornio on the Swedish border are one example. Due for completion next year, they will make it easier for allies to send reinforcements and equipment from across the Atlantic to Kemijarvi, an hour’s drive from the Russian border and seven hours from Russia’s nuclear bastion and military bases near Murmansk in the Kola peninsula.
Among forces based there, Russia’s Northern Fleet includes 27 submarines, more than 40 warships, around 80 fighter planes and stocks of nuclear warheads and missiles, data collected by the Finnish Institute of International Affairs (FIIA) shows.
In a military conflict with NATO, the Fleet’s main task would be to secure control of the Barents Sea and stop ships bringing reinforcements from North America to Europe through the waters between Greenland, Iceland and the UK.
That’s something Finland can help NATO resist.
“It’s all about containing those kinds of capabilities from the north,” retired U.S. Major General Gordon B. Davis Jr. told Reuters.
Maps showing marine traffic through the Baltic
Besides opening its territory, Helsinki is buying the right assets, particularly fighter jets, “to add value to (the) northeastern defence and, frankly, in a conflict put Russia at risk,” he said.
Sweden’s contribution will, by 2028, include a new generation of submarines in the Baltic Sea that Fredrik Linden, Commander of Sweden’s First Submarine Flotilla, says will make a big difference in protecting vulnerable seabed infrastructure and preserving access – currently major security headaches, as the September 2022 destruction of the Nord Stream gas pipelines read more showed.
“With five submarines we can close the Baltic Sea,” Linden told Reuters. “We will cover the parts that are interesting with our sensors and with our weapons.”
Analysts say the change is not before time. Russia has been actively developing its military and hybrid capabilities in the Arctic against the West, partly under the cover of international environmental and economic cooperation, the FIIA’s Deputy Director Samu Paukkunen told Reuters. Russia’s defence ministry did not respond to a request for comment.
Paukkunen’s institute estimates Western armed forces are militarily about 10 years behind Russia in the Arctic.
Even with the losses that Russia has sustained in Ukraine, the naval component of the Northern Fleet and the strategic bombers remain intact, Paukkunen said.
NATO-member Denmark phased out its submarine fleet in 2004, part of a move to scale back its military capabilities after the end of the Cold War, and it has yet to decide on future investments. Norway is also ordering four new submarines, with delivery of the first due in 2029.
“It seems to me that we have some catching up to do, because we haven’t done it properly for the last 25 years,” said Sebastian Bruns, a senior researcher into maritime security at Kiel University’s Institute for Security Policy.
Maps showing marine traffic through the Baltic
“A WHOLE PIECE”
Both developments show how the expanded alliance will reshape Europe’s security map. The region from the Baltic in the south to the high north may become almost an integrated operating area for NATO.
“For NATO it’s quite important to have now the whole northern part, to see it as a whole piece,” Lieutenant Colonel Michael Maus from NATO’s Allied Command Transformation told Reuters. He chaired the working group which led Finland’s military integration into NATO.
“With (existing) NATO nations Norway and Denmark, now we have a whole bloc. And thinking about potential defence plans, it’s for us a huge step forward, to consider it as a whole area now.”
This became clear in May, when Finland hosted its first Arctic military exercise as a NATO member at one of Europe’s largest artillery training grounds 25 km above the Arctic Circle.
The nearby town of Rovaniemi, known to tourists as the home of Santa Claus, is also the base of Finland’s Arctic air force and would serve as a military hub for the region in case of a conflict. Finland is investing some 150 million euros to renew the base to be able to host half a new fleet of 64 F-35 fighter jets, due to arrive from 2026.
An undated artist’s rendition depicts divers and an unmanned vehicle exiting the A26 submarine. Saab AB/Handout via REUTERS
For the May manoeuvres, nearly 1,000 allied forces from the United States, Britain, Norway and Sweden filled the sparse motorways as they joined some 6,500 Finnish troops and 1,000 vehicles.
Captain Kurt Rossi, Field Artillery Officer of the U.S. Army, led a battery bringing in an M270 multiple rocket launcher.
It was first shipped from Germany across the Baltic Sea, then trucked nearly 900 km to the north.
“We haven’t been this close (to Russia) and been able to train up in Finland before,” Rossi said.
If there was a conflict with Russia in the Baltic Sea area – where Russia has significant military capabilities at St. Petersburg and Kaliningrad – the shipping lane NATO used for that exercise would be vulnerable. Finland relies heavily on maritime freight for all its supplies – customs data shows almost 96% of its foreign trade is carried across the Baltic.
The east-west railway link across the high north will open up an alternative, which could prove crucial.
“I think the Russians can quite easily interrupt the cargo transportation by sea so basically this northern route is the only accessible route after that,” said Tuomo Lamberg, manager for cross border operations at Sweco, the Swedish company designing the electrification.
Maps showing marine traffic through the Baltic
“NOTHING BEATS THEM”
But that risk, too, may recede when Sweden joins NATO.
Down beneath the Baltic Sea waterline, the submarine commander Linden shows a reporter the captain’s quarters of the Gotland, one of four submarines currently in Sweden’s fleet, which will bring NATO’s total in the Baltic countries to 12 by 2028.
The Kiel institute expects Russia to add one to three submarines in the coming years, to bring its Baltic submarine total to four, along with its fleet of around six modern warships. Its capabilities at Kaliningrad also include medium-range ballistic missiles.
“This can be the loneliest place in the world,” says Linden, who captained the vessel for many years. On a typical mission, which lasts two to three weeks, there is no communication with headquarters, he said.
The Gotlands, like Germany’s modern Type 212 submarines, will be among NATO’s most advanced non-nuclear submarines and can stay out of port for significantly longer than most other conventional models, the researcher Bruns said read more .
“I would say, without a doubt, that the Gotland-class and the German Type 212 are the most capable non-nuclear submarines in the world,” said Bruns.
“There is nothing that beats them, quite literally. In terms of how quiet they are, the engines they use, they are particularly quiet and very maneuverable.”
In submarine warfare, Linden said, the primary question is where the adversary is. A careless crew member dropping a wrench or slamming a cupboard door can lead to detection.
“We talk quietly on board,” Linden said. “You shouldn’t believe … films where orders are shouted.”
The Gotland is based at Karlskrona, about 350 km across the Baltic from Kaliningrad. With an average of 1,500 vessels per day trafficking the Baltic according to the Commission on Security and Cooperation In Europe, it is one of the world’s busiest seaways – and there is really only one way out, the Kattegatt Sea between Denmark and Sweden.
The shallow and crowded seaway can only be accessed through three narrow straits that submarines can’t pass through without being detected.
LISTENING POWERS
If any of the straits were to be closed, the sea freight traffic to Sweden and Finland would be hit hard and the Baltic states completely cut off. But with Sweden in the alliance, that becomes more preventable, because Sweden’s submarines will add to NATO’s listening powers.
Linden says the Gotland’s crew can sometimes hear Russia’s vessels. The range of sound travel varies partly depending on the seasons. In winter, he said, you can hear as far as the island of Oeland – just a bit further than the distance between London and Birmingham in the UK.
“You can lie outside Stockholm and hear the chain rattling on Oeland’s northern buoy,” Linden said. “In the summer you can hear maybe 3,000 meters.”
By 2028, once Sweden takes delivery of a new design of vessel, this capacity will increase. The new design, known as A26, will allow submarine crews to deploy remotely operated vehicles (ROVs), combat divers or autonomous systems of some sort without putting the submarine or crew at risk, Bruns said.
“Depending on the mission it could be an ROV that safeguards a pipeline or data cable, it could be combat divers that go ashore in the cover of darkness, it could be almost anything.”
That capacity will increase Sweden’s scope to control comings and goings through the Baltic.
“If you count all the forces, with Germany in the lead and Sweden and Finland coming on board, all those have really shifted the balance in the Baltic Sea quite significantly,” said Nick Childs, Senior Fellow for Naval Forces and Maritime Security at the International Institute for Strategic Studies.
“It would make it very difficult for the Russian Baltic Sea fleet to operate in a free way,” he said. “But it could … still pose challenges for NATO.”
Anne Kauranen reported from Tornio, Johan Ahlander from Karlskrona; additional reporting from Gwladys Fouche in Oslo, Jacob Gronholt-Pedersen in Copenhagen and Sabine Siebold in Brussels; Edited by Sara Ledwith
PUNTO FIJO, May 4 (Reuters) – More than half of the 22 oil tankers in Venezuela’s fleet are so run down that they should be immediately repaired or taken out of service, according to an internal report from state-run oil company PDVSA that was shared exclusively with Reuters.
The report by PDVSA’s maritime branch, entitled “Critical deficiencies and risks of PDV Marina’s tanker fleet,” said years of deferred maintenance had left the entire fleet with “low levels of reliability,” at risk of spills, sinking, fires, collisions or flooding.
“The ships currently lack seaworthiness classification and certifications by flag nations,” the report said.
PDVSA and PDV Marina did not respond to requests for comment.
The report, dated March 2023, was among eight documents shared with Reuters describing the state of PDVSA’s tanker fleet from the oil company’s corporate office, trading division and maritime branch, as well as Venezuela’s maritime authority. The existence of the documents has not been previously reported.
Dated from Jan. 2022 to March this year, the documents detail the condition of the company’s tankers; the costs of chartering third-party vessels and the status of shipbuilding contracts with companies in Argentina and Iran.
The deterioration of the fleet has forced PDVSA to charter tankers to move its oil, which provides the bulk of Venezuela’s hard currency, the analysis by PDVSA’s trade division said.
PDVSA and the oil ministry did not respond to requests for comment.
The reports were prepared amid a wide-ranging anti-corruption probe ordered by Venezuela’s President Nicolas Maduro last October after the discovery of billions of dollars in missing payments for petroleum exports. More than 60 people have been arrested and PDVSA’s chief executive and the nation’s oil minister have been replaced.
The report from PDV Marina recommended withdrawing five tankers from active use; sending seven to shipyards for major repairs and installing transponders, fire extinguishers and communication equipment in others. No actions have been taken as the audit on the company’s operations continues.
Five of PDVSA’s tankers are at least 30 years old, past their recommended lifespan, according to the PDV Marina report. The last major maintenance work on the fleet was five years ago, the report said.
“The tanker fleet is showing a decline in the quality of its operations due to advanced physical deterioration, which implies higher maintenance and repair costs. Planning for sending the tankers to dry docks has been very affected by lack of payment to shipyards and providers,” the PDV Marina report said.
Reuters has previously reported on an increase in tanker collisions, spill risks and fires in Venezuela.
PDVSA leased 41 vessels last year, the documents said, paying about double the market rate, between $14,000 and $36,500 per day, to tanker owners willing to work with Venezuela despite U.S. sanctions imposed in 2019.
DELAYED SHIPS
At least four tankers ordered from foreign shipyards have been held up because of payment delays, cost increases and sanctions, according to the documents reviewed by Reuters.
The audits ordered by PDVSA’s new CEO Pedro Tellechea as part of Maduro’s anti-corruption probe could bring further delays, a PDVSA executive said.
“All contracts are frozen,” the executive said on condition of anonymity due to fear of retaliation. PDVSA’s legal and supply and trade departments are asking PDV Marina for documentation on the contracts, he added.
Venezuela has paid shipyards in Iran and Argentina at least $300 million for six new vessels ordered as far back as 2005.
It has taken delivery of only two of them, according to the documents.
PDVSA has paid almost 80% of the $160 million due for two tankers from Rio Santiago shipyard in Argentina, the documents showed.
Rio Santiago said it was not authorized to give information about that particular contract.
In addition, PDVSA paid almost 157 million euros (about $173 million), or 63% of a 248 million euros contract (about $272 million) to U.S.-sanctioned Iran Marine Industrial Company (Sadra) for four tankers, according to the documents.
Two of the four vessels were delivered after payment delays, difficulties with parts supplies and problems with insurance and certifications, according to the documents.
The payment delays generated extra costs for demurrage, the documents said.
Sadra did not reply to a request for comment.
Reporting by Mircely Guanipa; Additional reporting by Marianna Parraga in Houston, Eliana Raszewski in Buenos Aires and Parisa Hafezi in Dubai; Editing by Gary McWilliams and Suzanne Goldenberg
Moody’s warns will find it harder to raise capital
NEW DELHI, Feb 3 (Reuters) – Financial contagion fears spread in India on Friday as the Adani Group’s crisis worsened, with ratings agency Moody’s warning the conglomerate may struggle to raise capital and S&P cutting the outlook on two of its businesses.
Chaotic scenes in both houses of India’s parliament led to their adjournment on Friday as some lawmakers demanded an inquiry after a dramatic meltdown in the stock market values of Indian billionaire Gautam Adani’s companies.
The crisis was triggered by a Hindenburg Research report last week in which the U.S.-based short-seller accused the Adani Group of stock manipulation and unsustainable debt.
Adani Group, one of India’s top conglomerates, has rejected the criticism and denied wrongdoing in detailed rebuttals, but that has failed to arrest the unabated fall in its shares.
In the latest sign of the crisis widening, India’s ministry of corporate affairs has begun a preliminary review of Adani Group’s financial statements and other regulatory submissions made over the years, two government officials told Reuters.
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Although shares in Adani companies recovered after sharp falls earlier on Friday, the seven listed firms have still lost about half their market value, totalling more than $100 billion since Hindenburg published its report on Jan. 24.
Moody’s warned the share plunge could hit the Adani Group’s ability to raise capital, although fellow credit ratings agency Fitch saw no immediate impact on its ratings.
“These adverse developments are likely to reduce the group’s ability to raise capital to fund committed capex or refinance maturing debt over the next 1-2 years. We recognise that a portion of the capex is deferrable,” Moody’s said.
For Adani, a former school drop-out from Gujarat, the western home state of Indian Prime Minister Narendra Modi, the crisis presents the biggest reputational and business challenge of his life, as his firm struggles to assuage investor concerns.
Amid fears the turmoil could spill over into the broader financial system, some Indian politicians have called for a wider investigation, and sources have told Reuters the central bank has asked lenders for details of exposure to the group.
“Contagion concerns are widening, but still limited to the banking sector,” Charu Chanana, a market strategist with Saxo Markets in Singapore, said on Friday.
The Reserve Bank of India said the country’s banking system remains resilient and stable. State Bank of India said it was not concerned about the exposure to Adani Group, but further financing to its projects would be “evaluated on its own merit”.
Adani Enterprises shares closed 1.4% higher, after earlier slumping 35% to hit their lowest since March 2021. That low took its losses to nearly $33.6 billion since last week, a 70% fall.
Shares fell 5% in Adani Total Gas (ADAG.NS), a joint venture with France’s TotalEnergies (TTEF.PA), which said its exposure to Adani companies was limited.
Traffic moves past the logo of the Adani Group installed at a roundabout on the ring road in Ahmedabad, India, Feb. 2, 2023. REUTERS/Amit Dave
Adani Ports and Special Economic Zone (APSE.NS) was up 8%, while Adani Transmission (ADAI.NS) and Adani Green Energy (ADNA.NS) were both down 10%.
“There is a risk that investor concerns about the group’s governance and disclosures are larger than we have currently factored into our ratings,” S&P said, as it cut its outlook on Adani Ports and Adani Electricity to negative from stable.
India’s divestment secretary Tuhin Kanta Pandey told Reuters that Life Insurance Corp (LIC) shareholders and customers should not be concerned about its exposure to the Adani Group.
State-run LIC (LIFI.NS) has a 4.23% stake in the flagship Adani Enterprises, while its other exposures include a 9.14% stake in Adani Ports.
Reuters Graphics
‘ONE INSTANCE’
Adani, 60, has in recent years forged partnerships with, and attracted investment from, foreign giants as he pursued global expansion in industries from ports to power.
The market and financial crisis means foreign investors, many already underweight on India as they consider its stock market overpriced, are reducing exposure.
“One instance, however much talked about globally it may be … is not going to be indicative of how well Indian financial markets are governed,” Indian Finance Minister Nirmala Sitharaman told Network18 when asked about the market weakness.
Reuters Graphics
Hindenburg’s report said key listed Adani companies had “substantial debt” and shares in the seven listed firms had a downside of 85% due to what it called sky-high valuations.
The Adani Group has called the report baseless and said over the past decade, its companies have “consistently de-levered”.
The listed Adani firms now have a combined market value of $107.5 billion, versus $218 billion before the report.
That has forced Adani to cede the crown of Asia’s richest person to Indian rival Mukesh Ambani of Reliance Industries Ltd (RELI.NS), and he has slid to 17th in Forbes’ list of the world’s wealthiest people.
He had ranked third, behind Elon Musk and Bernard Arnault.
Reporting by Aditya Kalra, Chris Thomas, Ankur Banerjee, Bansari Mayur Kamdar, Shivam Patel, Tanvi Mehta and Rae Wee in Singapore; Editing by Clarence Fernandez, Mark Potter and Alexander Smith
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