port development summit 2013 (pac-atlantic)

Philippines Port Development Summit 2013Hyatt Hotel and Casino Manila

PhilippinesAugust 13-16, 2013

PORT CONGESTIONPORT CONGESTIONandand

WHAT NEEDS TO BE DONEWHAT NEEDS TO BE DONEMr. Ramon T. de Leon

Chairman – Pac-Atlantic Group

Philippines Port Development Summit 2013

CONTENTS OF PRESENTATION

A. Introduction

B. Current Situation

C. Causes of Congestion

D. Proposed Actions

E. What Needs to be Done


INTRODUCTION

1. “Port Congestion” “Port-Related Congestion”

1. Limited to Sea Ports only


CURRENT SITUATION

1. Traffic Handled by Manila Ports

4 MILLION4 MILLIONTEUs / YEAR

MICT

South Harbor

North Harbor

HCPTI

About 98% of total volume passing through

the country


CURRENT SITUATION

2. Batangas and Subic Ports: capacity vs. utilization

Batangas Port

Operator

Capacity

Utilization

ATI

400,000 TEUs

4.2% (2011)

Subic Port

Operator

Capacity

Utilization

SBITC

600,000 TEUs

5.6% (2011)


CURRENT SITUATION

3. Expansion at Manila Ports

MICT • Increased capacity to 2.5 million TEUs

• Another P4B for Berth 7

SouthHarbor

• Target capacity of 1.2 million TEUs• P4.2B for Pier 3 extension, CY expansion,

fleet improvement, IT enhancement


CURRENT SITUATION

4. Existing Metro Manila Road Network

• Shared with private and public utility vehicles

• Illegal vendors

• Illegally parked vehicles

• Makeshift basketball courts

• Makeshift market stalls

• Truck Ban

• Anti-Overloading Law


CAUSES OF PORT-RELATED CONGESTION

1. Proliferation of Obstructions

• Informal settler communities near port areas

• Tricycles and pedicabs in truck routes

• Illegal vendors

• Road diggings



2. Lack of Truck Holding Areas

• Forced to park along city roads



3. Lack of Cargo Rail System

• Will reduce number of trucks on the road



4. Lack of Road Linkages from Port to Ecozones

• Will reduce number of trucks on the road



5. Truck Ban

• Good or Not?

• 9 hours per day

• 39,543 trucks plying M.M. roads daily

• JARI study


NLEX12,004

11,116SLEX

9,910Rizal

4,641

MacArthur

* others are within MM

METROMANILA


6. Anti-Overloading Law

• Requires more truck trips

• Unclear road tolerable weight

• Substandard roads vs. overloading?



7. Overstaying Containers

• Hampers efficiency of port operations


PROPOSED ACTIONS

1. Diversion of Cargoes to Batangas and Subic

• Support for compulsory diversion


PROPOSED ACTIONS



METROMANILA

SUBIC

BATANGAS

110 kms

110 kms

Cargo of PEZA locators from CALABARZON

Cargo of Subic, Clark, Bataan, Tarlac, La Union locators

PROPOSED ACTIONS


• JICA Study: 50% reduction in port dues and docking fees

• DOTC plans mandatory diversion by 3Q2013

• Port operators oppose diversion and favor road upgrade


PROPOSED ACTIONS

2. Stop Expansion at Manila Ports

• JICA Study: 6-year moratorium in capacity expansion at South Harbor and MICT

• Both ports have already undertaken major expansion activities


PROPOSED ACTIONS


• Capex of P4.2B for port improvement over next three years• Add 1,960 TEUs of CY space by 2014• Add 100 slots in truck holding area• Acquire RTG cranes, empty container handler, spreader,

tractors• 2014: add 1 quayside crane and 2 RTG cranes• Technological improvements


Asian Terminals Inc. (ATI)

PROPOSED ACTIONS


• $200 million for additional 300 meters at Berth 6

• Acquire 3 quay cranes and reach stackers

• CY expansion

• P135 million for Berth 7


International Container Terminal Services, Inc.

PROPOSED ACTIONS

3. Cap in Manila Ports

• Limit cargo volume at Manila sea ports

• To lessen congestion in Manila, increase utilization of Batangas and Subic ports and boost growth in these areas


PROPOSED ACTIONS

3. Cap in Manila Ports

• 1 million TEU cap atPort of Bangkok

• Cargo diversion to Laem Chabang port

• In 2009, Laem Chabang was world’s 20th busiest port

• Present capacity: 6 million TEUs


PROPOSED ACTIONS

4. Infrastructure Upgrade

• Create a better road network

• Remove obstructions

• More truck holding areas

• DOTC roadmap:


• ICDs north and south of Manila• Rail connectivity from Manila ports to ICDs• Barge transfers to Cavite and Batangas

PROPOSED ACTIONS

4. Infrastructure Upgrade

• NLEX Harbor Link

• Port access road

• NLEX-SLEX connector road


NLEXMac ArthurHighway

HarborLinkHarbor Link

Phase 2

PortAccessRoad

NorthPort

SouthPort

NLEX-SLEXConnector

SLEX

PROPOSED ACTIONS

5. Conduct Further Studies

• Study by PPA and OFC-DOJ

• Signed MOA

• Prepare a Competitiveness Action Plan

• Equip PPA and OFC-DOJ personnel with expertise to effectively implement the Competitiveness Action Plan

• JICA study


WHAT NEEDS TO BE DONE

1. Increase Utilization of Batangas and Subic Ports

• Batangas and Subic ports are ready

• Overcome “chicken vs. egg” obstacles


• Convince shipping lines• Get truckers, brokers and forwarders to

locate near the ports• Ensure lower port and docking charges• Establish policies for continuous port

development


2. Government Intervention through Policy Formulation and Implementation

• Shipping lines may be content in calling Manila ports only

• Importers and exporters may be content in shipping though Manila ports

• Government must step in: Reduction in port and dockage fees, PPA and OFC-DOJ study, JICA study, Implementation



3. Pro-active Coordination Among Concerned Bodies


4. Implementation

End of Presentation


Thank You.

port development summit 2013 (pac-atlantic)

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