Bush urges end to port dispute

More than 100 ships are anchored off the coast

Industrial mediators in the US are working through the weekend to try to end a labour dispute that has crippled 29 west coast ports.

Talks were continuing on Sunday after President George W Bush - under pressure from business leaders - urged both sides to return to work while they resolve their problems.

He said the dispute was hurting the economy.

The largest car-making plant in the region, a Toyota-General Motors joint venture in Fremont, California, has shut down production and laid off workers after running out of parts from Japan.

The longer it goes on, the more harm it will do to the economy

White House spokesman Ari Fleischer

"The economy is going to hell in a hand basket here," said Robin Lanier, head of the West Coast Waterfront Coalition group of companies.

A senior official from the US Federal Reserve has estimated the cost of the dispute at $2bn a day.

The port authorities locked dock workers out on 29 September after they accused them of staging an illegal go-slow in a five-month contract wrangle over new technology.

Dock workers and shipping officials, together with a federal mediator, held a third day of talks on Saturday which went on for 15 hours.

Peter Hurtgen, director of the Federal Mediation and Consolidation Service, said that the issues separating the two sides were "ones of principal and therefore very difficult to resolve".

"It is two steps forward and one step back," he said.

Leading hi-tech firms such as Microsoft and Intel say they are also seriously concerned about the dispute.

A spokesman for the Consumer Electronics Association - of which Microsoft, Intel and Sony are members - said they want President Bush to use his powers to order an end to a labour dispute that threatens vital national interests.

'Severe risk'

The National Association of Manufacturers met federal officials in Washington to lobby for government pressure to end the lockout.

"Our economy's tenuous recovery will be at severe risk if they don't settle soon," association president Jerry Jasinowski said.

White House spokesman Ari Fleischer said the president was urging the parties to work together to resolve the dispute.

The dispute is costing the US economy $2bn a day

"The president's message to labour and management is simple: You are hurting the economy," he said.

The disruption to agricultural shipping has also left fruit and vegetables worth millions of dollars rotting at the ports.

More than 150 freight ships are anchored off the coast hoping to land their cargo.

The 29 west coast ports handle goods worth more than $300bn every year - much of it from Asia.

BBC economics correspondent Andrew Walker says there are fears that, if the dispute goes on for a month, several East Asian countries will fall back into recession because of their reliance on exports to the US.

Exporting nations such as China, South Korea, Japan, Taiwan and Thailand are expected to be worst hit.

The Pacific Maritime Association, which represents shipping lines and ordered the lock-out, agreed on Friday to allow a partial resumption of freight shipments to Alaska and Hawaii.

Both are highly dependent on imports from the mainland.