French Govt to End Corsica Ferry Blockades

French Prime Minister Manuel Valls said on Wednesday he would take steps "within hours" to end blockades of ports in Marseille and Corsica by workers of the SNCM ferry operator, who are striking over the firm's restructuring plans.

Workers at the loss-making company partially owned by Veolia have been on strike since June 24, occupying ferries and blockading access to part of Marseille's port for 16 days over fears they will lose jobs and job privileges.

The strike has left the island in part cut off from the mainland at the peak of the tourist season vital to Corsica's economy while holding up the flow of goods.

Valls, who has warned repeatedly that the strike could condemn the SNCM "to death", denounced violent clashes between police and strikers near the port of Marseille and said the government would act swiftly to end blockades.

"The blockades of boats and the violence at the ports are unacceptable," he told parliament during question time. "The government will take any measure necessary within coming hours to make sure these blockages end."

Police said that strikers were using a truck to block access to the Kalliste ferry - which is not operated by the SNCM - in the port of Marseille for more than a week, with the effect that commercial freight could not be unloaded.

Strikers were also occupying several ferries which typically bring tourists from the mainland to Corsica, stopping some 230,000 tourists from reaching the island at a cost of 1 million euros ($1.36 million) in missed revenue per day, Corsican tourism officials have said.

Valls and his transport minister said this week that the SNCM, which is 25 percent owned by the French state, was "sinking" and needed to be placed under court protection to shield itself from a European Commission order to repay 440 million euros in state aid.

The government has already instructed a mediator to facilitate negotiations between the unions and management, but with talks continuing for the past three weeks, Valls said there was no time for further discussion.

Owned 66 percent by Transdev - a public transport joint venture between water and waste group Veolia Environnement and state-bank CDC - the ferry operator has racked up cumulative losses of 250 million euros over the past decade despite subsidies it receives from French authorities.

Transdev and the government prefer a Chapter-11 style restructuring that could allow new owners to buy and operate SNCM's ships. For their part, the strikers want assurances that promises to limit job cuts under a past plan will be respected and that investments will be made.

The stalemate is holding up Veolia's plans to sell most of its stake in Transdev - a tram, train and bus operator with turnover of 7 billion euros and 90,000 staff in more than 20 countries - to CDC.

($1 = 0.7331 Euros)

(Reporting By Francois Revilla and Rger Nicoli in Basxtia, Corsica; writing by Nicholas Vinocur; editing by Ralph Boulton)