Davao-Sasa Port upgrade crucial to Mindanao trade growth

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Davao-1Modernizing the century-old Davao-Sasa port will fuel trade and spur economic and social development across Mindanao, according to Transportation Secretary Joseph Emilio Abaya.

“No less than a world-class Davao-Sasa Port is needed to meet the rapid growth of the country’s export demands over the next few years,” the Department of Transportation and Communications said in a statement, citing a study conducted for it by the International Finance Corporation (IFC) and the Development Bank of the Philippines (DBP).

“Exporters will have more efficient operations and importers will have better logistics. Shipping lines will have quicker turnaround times. Consumers will enjoy a wider range of imported products,” Abaya noted.

“With the Philippines being the second largest banana exporter in the world, and Davao being the top banana grower in the region, we need to pursue the long-term opportunities which will usher in inclusive growth in the south,” the transport chief said.

According to DOTC, the development of Davao-Sasa will benefit large-scale businesses as well as small and medium-sized enterprises, bolster the export industry, generate more jobs, and drive consumer costs down.

Abaya was scheduled to be in Davao City on July 10 to meet with various stakeholders about the project.

The Davao-Sasa port modernization project—the Aquino administration’s first seaport public private partnership (PPP) and first PPP project for Mindanao—is up for bidding, with submission of qualification documents scheduled for July 29.

The private sector and some local government units have, however, assailed the project’s P17-billion contract cost for being too high, exceeding the one proposed in another study conducted by the Philippine Ports Authority (PPA).

Contributing a high volume of exports from the region, banana growers, many of whom have transferred to private port Davao International Container Terminal (DICT), earlier said they have no plans of returning to Davao-Sasa, saying the area around the port is already congested with no room for expansion.

In the IFC-DBP study, Davao Region’s container traffic is projected to increase by at least 6% annually over the next 25 years and reach 3 million twenty-foot equivalent units (TEUs) by 2040.

The Davao-Sasa project will be implemented in three construction phases starting 2017 to 2020, and once completed, the port’s capacity will expand to 1.2 million TEUs. The port is seen to meet both existing and future demand alongside two other major ports in the region, the Hijo port and DICT.

The project involves expanding and modernizing the port, which includes building a new quay and installing new cranes to boost efficiency and defuse port congestion. At present, with the manual setup for cargo unloading, the process can take up to three days; but once the cranes are in place, unloading time will be drastically cut down to about three hours, said DOTC.