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Fuel protests posed old-style challenge to new economy |
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September 16, 2000
LONDON, SEPT 15 (AP) - It was not the dreaded millennium bug or a diabolical new weapon that crippled Britain's 21st century economy this week, but a loosely organized protest by farmers and truckers that hit a raw nerve: the supply of gasoline to the transport system. "The starvation of fuel to our key supply chains meant that the nation was facing a major crisis in the short-term future," said Geoff Dossetter, spokesman for the Freight Transport Assocation. For the protesters, it was a triumph. But for Prime Minister Tony Blair, and the leaders of industrialized nations around the world, it was a reminder that their economies could become more vulnerable as they become more advanced. Similar protests also hit Belgium, France, Germany and the Netherlands, but nowhere was the impact as great as in Britain, in part because the French government caved quickly to demands of the truckers, farmers and others who claimed that the double whammy of soaring oil prices and fuel taxes was driving them out of business. British truckers used different tactics from their European brethren, who clogged major arteries in city centers and along borders. In Britain, protesters blocked fuel shipments out of the 10 refineries that serve the country. And that had an enormous follow-on impact at steel plants, automobile factories, construction sites, supermarkets and other retail outlets that in recent years have vastly reduced the supplies they warehouse. The digital revolution, which allows businesses to track more closely the goods they use and sell, will allow them to cut back even further, but it could make them more vulnerable to an oil shock. "Because of the just-in-time method of supply and distribution, this is having a major impact. Companies simply do not have the supplies on hand that they used to," said Vincent Burke, a spokesman for the London Chamber of Commerce. Burke estimated that the protest cost Britain one billion pounds (dlrs 1.5 billion), about 10 percent of gross domestic product over four days. Supermarket shelves were bare of bread and other staples, factories warned of lay-offs, service stations throughout the country ran dry, trucks and buses clogged inner city streets, and tabloid headlines rained abuse on the government. The head of the supermarket chain Sainsbury's cautioned Blair that food was likely to run out in "days rather than weeks." Sir Peter Davis said that "suppliers, growers and producers delivering milk, bread and everything else to us are having great difficulties." The crunch came much more quickly than in a similar truckers' protest 20 years ago, said Alan McKinnon, professor of logistics at Heriot-Watt University in Edinburgh. "Supply systems are a lot more vulnerable now than they were in the past," McKinnon said. "This shows how our whole economy is dependent on oil. And it shows how fragile the system is." Increasingly, companies are centralizing production and warehousing. For protesters, he said, the message is: "If you are intent in paralyzing the system, you have fewer points to blockade." Britain has 10 oil refineries now, compared to 23 in the early 1970s, during the first "oil shock." Britain uses about the same amount of oil, 79 million metric tons of oil in 1999, down from 87 million metric tons 30 years ago. But the use has shifted from industry to transport, with the number of vehicles doubling to 27 million. The new economy also offered means to ease the pain. The number of conference calls booked through British Telecommunications doubled, from 1,100 to 2,200 per day, said a spokesman, Simon Gordon. For courier services, "demand rose," said Justina Hurley, a spokeswoman for the DHL courier service. "In some cases, we could meet it. In others, we couldn't." To keep the pace, she said, couriers arranged to meet customers "half-way" at drop off points, or used bicycles. Two-wheeled activity jumped. "It's been phenomenol," said Sally Greenwood, who usually rides a desk at Chamberlaine's bicycle store in Kentish Town. Repairs and sales are up 50 percent this week, she said, drawing her away from her accounting. "It's been so busy, I've been running around the shop as well!"
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