Philippine Inter-island Shipping Association

Port infrastructure and govt fees affect shipping costs

According to the Philippine Inter-island Shipping Association (PISA), the port infrastructure and government regulatory fees have great impact on high shipping costs. PISA President Christopher Pastrana said that the high cost of public transport in the country is due to the high cost of doing business: “In most cases, shipping cost is only part of the whole chain which includes trucking, and other means used to bring products to market.”

He said the high cost of operation plus higher taxes and higher regulatory fees were among the factors that contribute to the high transport cost in the domestic trade. “In domestic shipping, the inability of ships to attain economies of scale contributes largely to the high cost of shipping transport,” he said in PISA’s position paper.

The economies of scale in the domestic shipping, is hard to achieve because of lack of trade in a particular port to support a larger ship. PISA added that trade and production practice also prevent shipping in larger quantities.

The Philippine Ports Authority (PPA) said that the country has about 120 ports, many of which would be retrofitted to become RoRo -capable ports. PPA General Manager Jay Daniel R. Santiago: “We have the most competitive ports in the international, in terms of international capability, and in terms of local standard.”

These were the Manila International Container Terminal (MICT), operated by the International Container Terminal Services Inc. (ICTSI) and South Harbor and Batangas port, both operated by Asian Terminals Inc. (ATI).

“We also have old terminals in the out ports. If you go to the other economies, they also have ports that are technologically backward,” he told manilatimes.net.


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