Strike Halts Construction of New Pulp Mill in Uruguay
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A builders worker strike that began last Friday is reportedly interfering with construction of the new Montes del Plata pulp mill project in Punta Pereira, Uruguay, a joint venture of Finland-based Stora Enso and Arauco of Chile. According to an article in the Helsingin Sanomat (Helsinki, Finland) this week, Stora Enso so far has been unable to estimate how much longer the building site may remain at a standstill.
The builders are asking for a EUR 10 raise to their daily salary. The pay increase would go towards the workers' travel and meal expenses. The employees justify their demands with the fact that they live far from the construction site, according to the newspaper article. The builders have besieged the construction site, making it impossible for other professionals to cross the picket lines and enter the area to continue their work.
The workers' negotiation leverage is enhanced by the fact that several large capital investment undertakings are currently taking place in Uruguay and there is an acute shortage of construction labor, the Helsingin Sanomat reports, adding that "representatives of Montes del Plata were surprised by the industrial action, for the employer had been negotiating over the salary issue for several weeks with a local labor union." The employer noted that "the workers have become radicalized."
The construction project employs an average of 3,200 people, peaking at up to 6,000 individuals. The new, EUR 1.4 billion mill is scheduled to startup in less than two yearsIt will produce some 1.3 million metric tpy of pulp from eucalyptus trees. Stora Enso calculates that the mill will bring a 2% increase to Uruguay's annual domestic product.
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