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CONSTRUCTION

Spanish company back in Panama Canal deal

Panama has reached partial agreements with Spanish construction company Sacyr that halted work to expand the Panama Canal in a dispute over a huge cost overrun, its administrator said on Wednesday.

Spanish company back in Panama Canal deal
Photo: Rodrigo Arangua/AFP

Agreements in principle have been reached on some issues although others remain outstanding. But the Panama Canal Authority will not negotiate forever and does not rule out resuming the mega-project on its own in a week if a final accord is not reached, administrator Jorge Quijano told reporters.

He spoke after holding videoconference talks Tuesday with executives of the Spanish-led consortium hired to expand the canal linking the Atlantic and Pacific so it can handle larger ships.

Despite the progress, "that does not mean we have given up on the other alternative, which is to take charge of the project ourselves," Quijano said.

He gave no details of what points the two sides had agreed on and what the remaining sticking points were.

"Our patience has limits and we really feel this has to end in a week at the most," Quijano said.

Work to expand the canal was suspended last week by the GUPC consortium made up of construction companies Sacyr of Spain, Italy's Salini-Impreglio, Belgium's Jan de Nul and Constructora Urbana of Panama.

The dispute is over $1.6 billion in cost overruns in the project, the main part of which is to equip the canal with a third set of locks.

GUPC wants Panama to add that sum to the initial contract fee of $3.2 billion.

The century-old waterway handles five percent of global seaborne trade.

GUPC claims unforeseen geological difficulties have forced them to spend much more on cement than expected. They say that they based their estimates on data provided by the Canal Authority that were incorrect.

The canal expansion is one of the world's most ambitious civil engineering projects and was due to be completed this year.

But the builders have said completion may now be delayed up to five years.

The original canal, built by the United States mostly with workers brought in from the Caribbean, was opened in 1914.

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CONSTRUCTION

Spanish builders made ‘slaves’ by German firm

Wages below the legal minimum, contracts in a language they don't understand and blackmail tactics to keep them quiet: just some of the problems a group of Spanish builders in Holland contracted by a German firm have decided to speak out against.

Spanish builders made 'slaves' by German firm
The builders have just managed to get their hourly wages up from €6 to the legal minimum of €8 an hour. Photo of construction work:Shutterstock

"They want us because we're a cheap workforce," one of the builders who prefers to remain anonymous admits.

Since beginning work with a German firm on road crews in the Netherlands in the spring of 2013, this group of Spanish migrant workers have been bottling up their discontent and frustration.

They've just managed to get their hourly wages up from €6 ($8) to the legal minimum of €8 an hour after the Spanish embassy in Holland informed local workers union FNV Bouw.

But their precarious working and living conditions have still not been fully addressed.

Having signed work contracts written in Dutch and German, languages none of them speak, their awareness of the clauses surrounding extra time, holidays and sick leave is almost non-existent.

"We have to pay for our own work clothes. If we’re ill we don’t get paid," one builder tells Spanish news agency EFE from the tiny bungalows where they’re all housed together.

"Most of them are unaware that they have to sign up to the local town hall to receive social and health benefits," adds Ben Paulides, a local politician who thinks the language barrier is the main factor keeping the Spanish workers in the dark.

The man the builders blame for their poor working conditions is Zeko Rugovac, head of German building firm BS Rugovac Bau Gmbh, the company that brought them over from Spain.

According to the Spanish builders, his exploitative tactics have seen them work more than ten hours a day on the building of a motorway between the Dutch cities of Delft and Schiedam.

"They threaten to send them back to Spain if they speak out," union spokesperson Osman Yildiz told EFE.

Emilio Rincón, a 32-year-old builder from Cádiz who complained, was one of the ones who bore the brunt of "Rugovac's irregularities".

"They told me there was no more work for me and I’m still waiting to be paid my last wages and sick leave," Rincón explained.

But Zeko Rugovac, the Managing Director of BS Rugovac Bau Gmbh told The Local it simply wasn't true Spanish workers with his firm were being paid €6 an hour, or even €8.

He said those workers received between €12 and €13 an hour before tax, and he was willing to provide bank documentation showing this was the case. 

Claims of lower wages from Dutch union FNV Bouw were mere politics, Rugovac said.

"They are afraid of cheap labour coming in from Spain and other European countries," he added. 

Rugovac also said it wasn't true that workers had had to wait for wages. He said the current project in the Netherlands would finish in April and wages for the month would be paid in early May "as is normal in Europe".  

The legal tangle between BS Rugovac Bau Gmbh, the Dutch government body that has ordered the motorway to be built, and A4ALL, which is the group overseeing the motorway's construction, means no one appears willing to take full responsibility for the Spanish workers' precarious situation.

The matter is currently being investigated by Holland's Ministry of Social Affairs.

SEE ALSO: 10,000 jobless Spaniards to be kicked out of Germany

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