Just a few months after government officials found a way to ease the port congestion problem that started in 2018, a group of businessmen have warned of its recurrence before the end of this year. The Cold Chain Association of the Philippines made this warning last month, following the outbreak of the dreaded African swine fever, which prompted local government units to ban pork products in their areas (See, “LGU blockade on pork products may cause congestion at ports,” in the BusinessMirror, October 28, 2019). The ban, according to CCAP, could cause shipping containers to pile up in the country’s major ports.
For years, the country’s major ports, particularly those in the National Capital Region (NCR), have been grappling with the port congestion problem during the holidays, when there’s a substantial increase in import volume. However, the problem became more pronounced in 2014 when former Manila Mayor Joseph Estrada decided to ban trucks from the city’s streets from 5 a.m. to 9 p.m., Monday to Saturday. The former president turned city chief executive implemented the scheme to ease traffic in Manila.
While the truck ban helped decongest Manila’s streets, the congestion worsened at the city’s ports. As container vans piled up while the traffic scheme was in place for months, businessmen lost a lot of money because of the delays in transporting goods. The crisis forced the national government to create a task force that devised strategies to move cargoes out of the ports.
Regulators and experts have attributed the port congestion problem to a number of factors, including the fact that the Philippines is a net importer of food and fuel. The expansion of the country’s population, as well as the improvement in the purchasing power of Filipinos would compound the situation in major ports. This is because the increase incomes of people will hike demand for meat products and durable goods, such as cars.
Technocrats can say that the port congestion problem is a sign of economic progress, but if this is allowed to continue, it could hurt the bottomline and efforts of the Philippines to attract more foreign investments. As it is, logistics cost in the Philippines is already uncompetitive, according to a study undertaken by the Department of Trade and Industry, and the World Bank. The findings of the study, which were released in December 2018, revealed businessmen in the Philippines spend the most on logistics compared to those in four Southeast Asian competitors (See, “PHL logistics costliest among 4 Asean nations,” in the BusinessMirror, December 7, 2018).
Dealing with the port congestion problem, according to a paper published by the Congressional Policy and Budget Research Department in 2015, requires long-term solutions. While stop-gap measures helped ease the congestion in 2014, industry stakeholders and government officials recommended a number of long-term measures to prevent the problem from recurring. The top 3 prescriptions, according to the CPBRD paper, are upgrading and modernizing the country’s infrastructure, using Batangas and Subic as alternative ports, and the implementation of a national integrated transport plan.
Businessmen can take comfort in knowing that help is on the way. Public Works Secretary Mark A. Villar assured during the BusinessMirror’s Coffee Club Forum on Tuesday that long-term solutions to the port congestion problem will soon materialize. In the years to come, one of the youngest members of President Duterte’s Cabinet vowed that businessmen will no longer have to grapple with the nightmare at the ports that has hounded them for years.