As an archipelagic and maritime nation, efficient ports in the Philippines are vital to its trade, connectivity, and economic growth.
Shipping in the country is a primary means to connect its more than 7000 islands and move people and goods. Hence, it also plays a crucial role in achieving the government’s objective of national unity.
The performance of ports and terminals is crucial because it affects a country’s trade competitiveness.
Nevertheless, port congestion is one of the country’s pressing problems, which is valid for the port of Manila, the country’s largest seaport.
The Excelsior article, “Current State of Port Congestion in the Philippines“, describes port congestion in Manila as a “situation wherein a growing number of vessels are starting to queue up outside the port to wait for any available space where they can load or offload their cargo.”
More from the Excelsior article below:
- Port congestion is inevitable for a country surrounded by seas like the Philippines, but it could have long-term adverse impacts on its economy if it persists. The article says that time is highly precious to importers, exporters, freight forwarders and other logistics services providers, and any delays due to congestion can be very costly.
- Port congestion in Manila has gone worse and occasional fiasco has been occurring between the government and the Local Truckers Association of the Philippines due to the long lines of trucks waiting inside the terminals.
- The government pointed to the high number of empty containers clogging the terminal as the root cause of the problem, which they seek to alleviate through policies that limit the entry of empty container vans. On the other hand, this problem also suggests a limited space for container yards that indirectly raises the cost of trucking.
Congestion in the port of Manila, the leading container getaway to the Philippines, also affects refrigerated shippers. According to a Joc article, “Congestion clogs port of Manila,” container ships must wait up to five days before they can berth.
The congestion has led Hapag-Llyod, a major international shipping and container transportation company, to issue a temporary ban on reefer imports bound for Manila on January 23, 2019, due to terminal congestion at manila ports and limited trucking capacity. The article mentions that since then, the port has improved to ease congestion.
News from the Philippine Ports Authority says that if the congestion problem continues in Manila port, it could face closure. “Ports, specifically the Manila ports, are the lungs of the country’s commerce and trade. These lungs right now are not functioning efficiently due to congestion,” Santiago stressed.
More excerpts from the PPA are below:
Santiago appeals to cargo owners and consignees to withdraw cleared, ready for delivery and overstaying cargoes. “If we continue to ignore calls to withdraw even only those cleared, ready for delivery, and overstaying cargoes, these lungs are in danger of total collapse, resulting in full-blown port congestion, or worst, a shutdown, and consequently a shortage in the much-needed goods and supplies which are expected to address the demands of the market,” Santiago explained.
Manila ports fear shut down due to continued cargo congestion, slow pull out
Philippine Port Agency (PPA), with relevant agencies like the Bureau of Customs (BOC), the Department of Trade and Industry (DTI) and the Department of Agriculture (DA), are looking at measures to prevent congestion at the ports.
Serious measures include government forfeiture of overstaying cargoes, reducing the cargo clearing period and free storage period to incentivize cargo owners to withdraw their containers or face heavy fines, penalties, and storage fees.
The article says that PPA has also designated an area in the Manila North Harbour to move all overstaying foreign containers to de-clog the port.
The PPA is looking to increase tariffs of ports to improve its facilities which could also lower logistic costs, says PPA General Manager Jay Daniel Santiago, the Manila Time reports.
“If we have efficient ports, the logistics cost will be lowered in the long run, but we need to invest now, and we don’t have any source of investment except the tariff rates. PPA does not derive any subsidy from the national government, it’s self-sustained, so we need to improve and modernize our facilities,” he said.
The ESCAP 2020 report, “Sustainable Port Development and improving Port Productivity in ESCAP Member Countries“, highlights the major port infrastructure in the Philippines found in its major cities like Manila, the country’s capital, Cebu, Iloilo, and Davao.
These ports are located in the Luzon region, the northern part of the country, the Visayas region in the middle, and the Mindanao region, the southern part of the county. They are the main hubs for moving people and transporting cargo from one region or city to another.
The report mentions the Philippine Maritime Industry Development Plan (MIDP) 2019-2028 as the first comprehensive effort to understand and address the core problem of the Philippine maritime sector to plan and implement programs that meet the demand of the maritime industry, address key challenges, and seize domestic and global opportunities.
It mentions that the plan aims to achieve national and global competitiveness in the maritime industry between 2019 to 2028 by expanding domestic shipping routes, tourist destination areas, coastal and inland waterways, and enhancing enabling policies and institutions.
The Build Build Build program launched under President Duterte’s administration also aims to improve infrastructure in the country by investing in significant infrastructure, including seaports.
The government’s BBB program includes large projects that address significant bottlenecks, focusing on transportation, water resources, and energy. Improved transportation and connectivity will help farmers bring their produce to the markets and raise the income of the rural population.
Moreover, quality and resilient infrastructure will reduce business costs, attract more investments, and improve the country’s productivity. As a whole, the project aims to improve Filipinos’ lives and boost the economy.
Leave a Reply