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Philippines must change the administration of its seaports

Author: Luc Citrinot / Date: Fri, 08/02/2013 - 00:23

Philippines newspaper Daily Inquirer pleas the government to let privatize ports inside the country and asks for an ending of the wide powers hold by the current Philippines Port Administration.

MANILA - The Philippines is the world’s second largest archipelago with over 7,100 islands, just behind Indonesia. Anybody would then think that port facilities would be of the utmost importance for the country. Unfortunately, according to the newspaper Daily Inquirer, an outdated administration frame is taking  its toll on the development of good port facilities. All the ports are for now managed by the Philippines Ports Authority (PPA). It not only regulates the industry but acts also as a developer of ports and competitor of the private sector in maritime trade and port services.

And as many public administration, PPA is a enormous machinery which is slowy moving as it faces no challenges. The newspaper estimates that the company has been blamed for the poor state of interisland transportation. Ports welcomed in 2011 close to 49.5 million passengers and some 342,000 shipcalls.

Government ownership of some 100 ports across the country also translate into insufficient investment to modernize and expand port facilities. And despite calls to privatize a large number of the country’s ports, the government has so far lacked the willingness to change anything. Recently the Chambres of Commerce of South Luzon called on the government to modernize and develop the various ports across the country. And asked also to end up some of the roles that the PPA plays today and which is interfering with a fair competition.  

Members of the Philippine Chambre of Commerce and Industry (PCCI) from Regions IV-A (Cavite, Laguna, Batangas, Rizal and Quezon), IV-B (Mindoro, Marinduque, Romblon and Palawan) and Bicol have already asked the Department of Transportation and Communications to amend the PPA charter and leave the agency only with its regulatory function. “An amended PPA charter will signal to investors that they can expect fair competition in developing and operating ports,” said PCCI president Miguel Varela. “A level playing field will be an incentive for large infrastructure projects because investors will feel predictability in their operations if the government regulator is not a competing developer of ports at the same time.”

Philippines Chambres of Commerce asked the Department of Transportation to proceed with privatization. So far, little has been done despite the promise by the current President Aquino administration to at least transfer five state-controlled ports to a public-private partnership’s entity. The first targets included the ports in Iloilo, Cagayan de Oro, Zamboanga, Ozamiz and General Santos as well as the roll-on, roll-off (Ro-Ro) ports covered by the so-called nautical highway that connects Luzon to several islands in the Visayas all the way down to Mindanao. The sorry state of Davao Port infrastructures was for example the reason why ASEAN did not consider the maritime facility fit to be part of ASEAN Ro-Ro shipping network. Totally privatized are Batangas Port, Manila North Harbor, Manila International Container Terminal and Manila South Harbor.

An efficient network of ports is very crucial to bring economic prosperity to all regions across the Philippines as they help to open up destinations and empower secondary cities as well as local communities by developing trade.