19 December 2012

Manila Ports’ Decongestion Moves Up

The Subic-Clark Alliance Development Council has thrown its support behind a new set of policy proposals aimed at decongesting traffic to and from the Manila ports, saying such policy mix will give a major boost to the underutilized Subic and Batangas ports to where spillover container cargoes would be rerouted.

The proposed policy mix is contained in a study funded by Japan International Cooperation Agency (JICA) and includes, among others, new pricing strategies such as reduced wharfage, berthing fees and vessel-related charges in Batangas and Subic ports; and a six-year delay in capacity-expansion investments at the South Harbor and Manila International Container Terminal (MICP).

“The JICA-funded study validates what we have been saying all along: That we should learn from Laem Chabang experience and that the already congested Manila ports should stop accommodating more shipments and allow the active use of both Subic and Batangas ports,” Felicito Payumo, SCAD Council chairman, said as he recalled the Bangkok port experience that led to the rise of nearby port of Laem Chabang.

Manila is equidistant at 110 kilometers from both Subic up north and Batangas down south, nearly the same distance between Laem Chabang and Bangkok.

“By way of comparison, the Laem Chabang port in Thailand was built to decongest the Bangkok river port – the same reason we built Subic port to decongest Manila. Both Bangkok and Manila ports were doing two million TEUs (20-footer equivalent units) then. Now, Laem Chabang with six berths is doing three million TEUs while Bangkok is limited to just one million TEUs,” said Payumo, a former chairman and administrator of Subic Bay Metropolitan Authority (SBMA), which owns two container terminals in Subic freeport, and now board chairman of Bases Conversion and Development Authority.

“The policy mix that JICA study is endorsing to decongest port and road traffic in Metro Manila augurs well for both Subic and Batangas ports, the capacities of which are presently underutilized,” Payumo said. “If adopted and carried out, this policy mix can stimulate the development of Southern Tagalog and Central Luzon regions.”

The JICA-funded study, which was conducted by Transport and Traffic Planners Inc., said port usage in Subic in 2011 was 5.6 percent of its actual capacity and port utilization in Batangas, 4.2 percent. The Manila ports, it added, handled 98.2 percent of total volume of container traffic passing through these three major ports (Subic, Manila and Batangas).

Payumo noted that although both Subic and Batangas ports had begun adjusting their pricing strategies, there were still adjustments to be done, like changes in vessel-related charges.

“There is also a need for shipment consolidators as there are enough export volumes in the Subic hinterlands which still pass through the Manila ports. This is the only way to break the ‘chicken or egg’ situation for the Subic port, where few ship calls are attributed to lack of volume shipments, and where the lack of volume shipments is blamed on few ship calls,” he said.

JICA earlier estimated that the provinces of Pampanga, Zambales, Tarlac, Bataan, Bulacan and Pangasinan generated a combined cargo volume of 1,572 TEUs per week, which would total to 786,000 TEUs a year, a volume that exceeded the combined capacities of two container ports in Subic. (Bernie Cahiles-Magkilat, Manila Bulletin)