Home » 3PL/4PL, Breaking News » Little progress seen in PH logistics sector

Efforts to attract foreign investments to the Philippines’ multimodal transport chain and, in turn, drive development of the logistics industry appeared to have stalled last year after a spurt in 2011.

This emerged in the Arangkada Philippines Second Anniversary Assessment, which rated actions taken and progress made on a number of private sector recommendations in 2012.

Logistics, which advocacy paper Arangkada Philippines considers one of the “big winner” industries in the country, was one of the sectors reviewed.

Arangkada said of the 22 recommendations for the logistics sector, three indicated progress, four declined and 13 were steady.

The recent report said no change had been seen in the area of attracting foreign investors to the logistics industry. From a four-star rating in 2011 for having “started” efforts to attract foreign investors in the multimodal transport chain, the sector got only three stars last year, along with the remark “not started.”

“The ‘negative list’ of restricted investment areas has not become less negative. What constitutes a ‘public utility’ has not been clearly defined in decades,” said Arangkada Philippines.

A proposal that espoused groups of importing companies to explore charter of ships received a blank star for both 2012 and 2011 and described as “no longer relevant” because of the present oversupply of vessels and low international freight rates.

The main recommendation to promote Batangas port for Calabarzon-destined shipments earned five stars for making substantial progress, as did the proposal to promote the use of both Batangas and Subic ports with the Philippine Economic Zone Authority and Subic Bay Metropolitan Authority, Arangkada said.

The report noted MCC Tansport, an intra-Asian container carrier, is now providing weekly feeder services from Singapore to Batangas, while French shipping giant CMA-CGM is planning to support Batangas as well. Meanwhile, APL and Wan Hai are now providing feeder services to Subic, the report added.

“SBMA is considering attracting additional feeder lines and more frequencies through take-or-pay volume arrangements. However, no concrete offers (had) been made at the end of 2012,” the report said.

A recommendation to allow direct consolidation of cargoes in PEZA-bonded warehouses also ground to a halt last year after making substantial progress in 2011, the report showed.

“PEZA has issued Letters of Authority for such operations but BOC (Bureau of Customs) has effectively blocked PEZA deconsolidation hubs by not allowing access to their IT systems,” Arangkada said.

The customs bureau believes that by allowing deconsolidation in PEZA ecozones, their present policy of freezing the permits for bonded warehouse will be circumvented, the report said.

“This overlooks the fact that PEZA ecozones in their own right are customs bonded,” the report added.

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