DTI urges Sunday work to ease port congestion

Categories: Business Updates

Date Posted: 14 Jul 2014

Trade Secretary Gregory Domingo said clogged trade at the Manila ports could take two more months to normalize and could slow exports growth this year.

Domingo thus urged shippers – importers and exporters – to utilize the port capacities on Sundays for a virtually 24/7 operations and for the truckers to slash by half trucking fees charged on shippers on those days as an incentive.

These twin moves, he said, would help decongest the ports in as fast as three weeks and would aid in getting back to normal movement of goods in and out of the Manila ports.

“At the rate this is going, it will two months to normalize which is probably by September,” Domingo said in a chance interview.

He said based on observation, the ports are free Sunday and Monday morning such that the utilization is only below 10 percent on these days.

“We are talking to big shippers importers and traders, to utilize Sunday and Monday to speed up decongesting the ports. The capacity is going to waste. We all have that capacity but everybody is working five and a half days a week when we can operate 24/7. Everybody is resting on Sundays. Even the active shipments are not being pulled out on a Sunday or on a Monday,” Domingo said.

He said truckers should significantly reduce their fees as an incentive to shippers to pull out and bring their goods e when capacity utilization is low.

It appears that shippers have to pay premium if they work on Sundays not only in terms of overtime pay to their own workers but also on trucking .

“Everybody is complaining of not being able to ship or receive their cargoes but they hesitate to work Sundays. If they hesitate, they should not be complaining because there is a solution. The ports are always open,” said Domingo.

Domingo said even at 50 percent discount in trucking rates, truckers would still benefit in terms of more trips because the turnaround would be faster on Sundays when Manila streets are traffic-free.

Going forward, he said, truckers would get more business as congestion at the ports ease.

“It’s a win-win for everybody,” he said.

Domingo said the Philippine Ports Authority and the port operators have agreed on short-term solutions to decongest the ports by allowing free parking of empty container vans in Subic as well as a 90 percent discount for those which utilize Subic and Batangas ports.

He said since the congestion, Batangas port has seen its capacity utilization rate to surge five times to 25 percent from 5 percent.

From one ship call per week, the Batangas port now registers 7 shipcalls per week.

Domingo admits the increase in the truck rates (of no more than 50 percent) following the imposition of the Manila daytime truck ban has an impact on prices of commodities.

He said this should only be temporary.

“The price increases, if at all, should only be temporary. Hopefully, once everything normalizes, they will bring down the cost again,” he added.

Domingo is hopeful the port congestion would be resolved soon so as not to greatly shave full-year exports figures.

“We’ll see if this is resolved soon, exports might be able to catch up. For now, there are shipments facing delays but once this normalizes, they would catch up,” he said.

Domingo, however, is sticking to the 8 to 10 percent growth target for exports the year although he hinted that the increase could be slower.

As it is, exports of locators in the economic zones registered slower growth of 2.17 percent between January and May t to $17.446 billion from $17.074 billion in the same period last year. Zone locators account for 80 percent of total merchandise exports.

The Philippine Economic Zone Authority said it is poised to revise its exports target downwards from 8 percent.
Written by: Irma Isip

Source: http://www.malaya.com.ph/business-news/business/dti-urges-sunday-work-ease-port-congestion

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