Port, traffic congestion stalling economy

ON DISTANT SHORE
By Val G. Abelgas

With the political chaos brought about by the pork and corruption scandals, the growing feud among the three branches of government, confusing signals coming from Malacanang on moves to amend the Constitution, uncertainty of the Bangsamoro peace deal, and many other issues eroding investor confidence and slowing the Philippine economy, the government can ill afford to ignore an immediate and very real threat to economic growth – the worsening congestion in Manila’s ports.

The port congestion, which was aggravated by the twin truck bans imposed by the City of Manila and the Metro Manila Development Authority, has become so bad, many shipping lines are hesitant to accept shipments to Manila. Why? Because several ships are forced to wait idly for several days on Manila Bay because they cannot unload their containers due to the heavy congestion in the Port of Manila and the Manila International Container Terminals (MICT).

According to the Bureau of Customs, it will have to move out 8,000 containers a day until the end of the year to bring back the terminals to a healthy level, meaning 50% to 60% availability at any given time.

“There’s no way we can do that from now until December 31,” a BOC spokesman said.

December 31 would, of course, be too late for the expected onrush of both incoming and outgoing shipments in the weeks prior to the holiday season. The months September to December are considered the peak season in shipping because of the goods being shipped in and out of the ports to catch the Christmas season in the Philippines.

If the ports are not decongested by next month, it would result in chaos for the importers, exporters, shippers, truckers and, of course, the balikbayan box forwarders. It’s not even the peak season yet and the ships already have to wait more than a week to unload their containers, can you imagine what the situation would be with the onset of the peak season next month?

The Philippine Port Authority and the customs bureau are asking all companies to conduct business during weekends, when traffic is lighter in Metro Manila, to help decongest the two Manila terminals. They have also asked shippers and traders to utilize the Batangas and Subic ports, which are not fully utilized.

The Clark Development Corp. has opened a three-hectare container depot to be made available to overstaying containers that need to be moved out of the two Manila ports. Thousands of containers have been left idle in the two terminals for months for various reasons, such as those awaiting customs inspections and inability of shippers to pay taxes and other charges.

But what worsened the port congestion in the past several months are the two truck bans imposed by the City of Manila and the MMDA. The truck bans, which was imposed to hopefully relieve traffic in Metro Manila, left truckers just a five-hour window (from 10 a.m. to 3 p.m.) to use the traffic lanes. This lengthened the turnaround time of trucks from one day to at least three days. Each day of the truck ban leaves an additional hundreds of containers in the terminals.

We understand the concerns of Manila Mayor Joseph Estrada and MMDA Administrator Francis Tolentino on the nagging traffic problem in the metropolis. After all, two separate studies by the Japan International Cooperation Agency (JICA) and the DOT in 1999 and the University of the Philippines National Center for Transportation Studies have shown that the daily traffic congestion in Metro Manila costs the Philippine economy P140 billion a year.

Billions are lost yearly in terms of wasted gasoline and lost labor hours, and indirectly, the monstrous traffic jams result in withdrawal of potential foreign investments, missed business opportunities and reduced inflow of capital.

But imposing the tough truck bans has not mitigated the traffic and has resulted in worse problems for the economy. In fact, economic growth has slowed down significantly to a mere 5.8% since the truck bans were imposed. Inflation rate has also gone up to more than 5% because the port congestion and the truck bans have significantly caused a dent on the supply of goods, resulting in the spike of prices of basic commodities.

In fact, during a congressional hearing on Monday, the Association of Shipping Lines Inc. said the shipping industry has so far lost $5.4 billion since the daytime truck ban was implemented in Manila last January.

Another industry that is hurt most by the port congestion and the truck bans is the balikbayan box industry, which is still reeling from the delays and costs of DHS inspections in US ports and must now contend with the additional delays aznd costs resulting from the port congestion and the truck bans.

The Filipino cargo forwarders also have to contend with complaints from customers, who are probably not aware of the problems brought about by the DHS inspections, the port congestion and the truck bans.

A long-term solution to Metro Manila’s traffic congestion has to be found. The metropolis has an incredible population of more than 20 million packed in a very small space, and it’s only bound to increase rapidly. The solution should include programs to encourage people to move out of Metro Manila by dispersing industries to the countryside.

The customs bureau, at the same time, has to find ways to facilitate the movement of containers from the ports. Customs examinations should be done faster and the length of time before unclaimed containers should be shortened. The PPA, on the other hand, has to improve the terminals in Subic and Batangas to encourage some shippers to utilize them.

The bottom line is that the Philippine government will have to find a long-term solution to Metro Manila’s traffic problem and the congestion in the ports if it doesn’t want the economy to stall.

(valabelgas@aol.com)