The maritime industry employs thousands of people, not counting the employment to ancillary services and retail sector, and with Filipinos as a preferred supplier of maritime workers or sailors, the sector is easily a major dollar earner of the country.
However, issues like shortage of qualified personnel and lack of critical infrastructure in ports continue to hound the maritime industry.
The reputation of Filipino seafarers as dedicated, hardworking and love for challenges is undisputed making them the preferred choice of foreign vessels. However, there is need to upskill and upgrade their qualifications to be able to fill the void in the global maritime industry, which sadly has led to an increasing number of sea accidents and incidents involving Filipino ships and crews.
Another major issue is the rising cost of fuel with crude prices doubling in the last few years, which had gravely impacted the cost of shipping. This has made it difficult for Filipino shipping companies to compete with foreign counterparts.
Undeniably, the country’s ports leave much to be desired, for the sector to continue to grow.
If left unaddressed, these critical issues would have a negative impact on the country’s economy, a fact that was revealed in the first two years of the President, when most European ships refused to hire Filipino seafarers unless they were provided skills needed by a modernizing global maritime industry.
Congestion at the ports cause delay in the delivery of goods thereby affecting commodity prices. Congestion causes delays in the unloading of cargo from the ships causing shortage of certain goods, principally food and medical supplies, and increasing the cost of imported goods. This issue is not exclusive to the country, but affected the world because of the pandemic, which disrupted the global supply chain.
Port congestion and its accompanying delayed unloading and release of goods affect the cost of logistics and ultimately the price of goods.
Recently, the Confederation of Truckers Association of the Philippines (CTAP), said at least 27% of the price of goods passed on to consumers go to clearance, documents and other fees in the processing of cargoes.”
Only around 50% of container vans in the port are being released daily compared to 75% before, they added.
To be fair, the government has been working to address these issues, but progress has been slow. In the meantime, businesses and consumers bear the brunt of the delays and higher prices. The sooner these issues are resolved, the better to avoid further disruption and economic hardships.
The maritime sector is considered the backbone of international trade and key engine driving globalization and competitiveness. By volume, the sector accounts for 80% of global trade and by value at over 70%, based on estimates of the United Nations Conference on Trade and Development.
Last June, the Philippine Ports Authority said local ports continued to participate in economic globalization, advancing its development among countries in Southeast Asia based on latest date from the Drewry Maritime Research, surpassing the static volumes of other SEA peers.
The Port of Manila, with a double-digit growth was the only regional port that achieved it compared to the largest ports in the region, which suffered declines in volumes and other ports that had only single-digit increases.
The report measured the POM’s Twenty-foot Equivalent Unit (TEU), the exact unit of measurement to determine cargo capacity for container ships and terminals. In 2022, the POM handled a total of 5,474,484 TEUs, marking a significant 10 percent increase compared to the 4,976,014 TEUs handled in 2021, making it the 7th busiest gateway port in South East Asia (including all container, gateway, transshipment and domestic cargo). The research also shows that in terms of gateway volumes, the Port of Manila ranked 6th, with a growth rate of 10.7 percent after handling a total of 3,962,111 TEUs in 2022 compared to 3,580,642 TEUs in the preceding year.
The ports in the South also demonstrated huge advancements such as the Port of Cebu which ranked 13th, with a 2.5 percent year-on-year increase after handling 937,052 TEUs in 2022 from 914,111 TEUs in 2021; and the Port of Davao, at the 15th spot, with a 0.1 percent growth, handling 824,898 TEUs in 2022 from 824,343 TEUs in the previous year.
On a per terminal basis, the Manila International Container Terminal (MICT), the Philippines’ largest international gateway, ranked 3rd amongst the largest gateway ports in the region (excluding transshipment and domestic volumes) after handling 2,508,119 TEUs in 2021 – just behind Westport Kelang Multi Terminal in Malaysia and Saigon NewPort – Cat Lai Terminal in Vietnam. MICT bagged the 11th spot out of the top 20 terminals in the region while Manila NorthPort ranked 19th.
PPA General Manager Jay Santiago said this success is a product of commitment, hard work, and transparency to create more port infrastructures that are at par with global trade.
“The PPA is further improving its level of commitment towards strengthening and evolving Philippine ports to cater global demands. The figures last year as shown in the data is a testament that Philippine ports are one of the leading ports in South East Asia”, said Santiago.
The growth in container volume as shown in the research translates into better figures for the economy, creating a ripple effect in all sectors.
“These figures are not just development in the Philippine ports’ South East Asia ranking, these are contributing factors that can positively impact our economy, including transportation, logistics, and manufacturing, generating employment opportunities and contributing to economic development," Santiago concluded.
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