For the first time in more than 20 years, Singapore's state-linked port operator PSA Corp will lay off workers amid intensifying competition from Malaysia and other rivals, Singapore media reported yesterday.
Deputy Prime Minister Lee Hsien-loong (
The lay-offs follow an announcement by PSA on Friday that it will shed its non-core business to focus on its main strengths. No estimates of the workers to be laid off were released.
PSA, which operates one of the world's busiest ports, has some 6,000 employees. The last time it retrenched staff was in 1980, when 300 employees were laid off, the Sunday Times said.
A 43-year-old operations assistant who has been working for PSA Corp for 25 years could not believe the news.
"The port's the backbone of Singapore," he said. "They still need manpower. I don't think they will let us go."
Minister Lee was quoted by TV station Channel News Asia's Web site as saying that "you cannot carry any surplus baggage and you have to run as trim a ship as possible."
"Particularly, at PSA, with competition, tariffs will have to come down and they have to make sure that their costs are kept to the lowest possible extent," the minister said.
PSA Corp announced Friday that it was transferring its airport handling, cruise terminal and exhibitions businesses, and its interest in a cable car operator, to its parent Temasek Holdings.
The transfer, subject to regulatory and other approvals, is targeted to take effect at the end of March.
PSA said container volumes handled by its domestic and international terminals in January rose 28 percent. Throughput at its Singapore terminals increased 5 percent to 1.38 million 20ft equivalent units (TEUs) and overseas terminals rose 118 percent to 727,000 TEUs.
In 2002, the port operator's total throughput grew 28 percent to 24.5 million TEUs and overseas operations soared 115 percent to 7.8 million TEUs.
The sharp rise in contributions from its overseas terminals came mostly from the April acquisition of the Hesse Noord Natie terminal in Belgium, and the July opening of a terminal at Guangzhou in southern China.
Singapore has seen increasing challenges to its status as Southeast Asia's pre-eminent shipping hub.
The Port of Tanjung Pelepas, in neighboring Malaysia's southern Johor state, has snared two of its prime clients, Danish firm Maersk Sealand and Taiwan's Evergreen Marine Corp (
Moody's Investors Service downgraded its outlook for PSA from stable to negative in December, reflecting concerns about its trading environment.
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