Marina pushes for hub-and-spoke system

Marina pushes for hub-and-spoke system THE Maritime Industry Authority (Marina) is pushing for the development of the port hub-and-spoke system to lower logistics cost in the country, said Marina administrator Vicente Suazo, Jr. in an interview with PortCalls. Under the hub-and-spoke system, only a few ports will be designated as hubs with the rest functioning as spokes, feeding cargo into the hubs. The present system focuses on the development of ports in almost every municipality to boost regional trade. The system, said Suazo, needs enormous investments which the country can ill afford at this time. It also encourages traders to ship products as they please pushing logistics cost higher, eventually resulting in higher market prices. Suazo identified four major ports that could serve as hubs: Manila, Cebu, Cagayan de Oro and Davao. The four handle 60%-70% of the total local and foreign trade of the country. The hub-and-spoke system will also entice shippers to consolidate their cargoes and ship in bulk, cutting logistics cost. In addition, it will allow vessel operators to command trips and go to hubs with the most volume of cargoes to utilize the entire capacity of vessels. To date, only about 50% of the cargo capacity of vessels are utilized, a situation that also contributes to high logistics cost. "Developing our ports into hubs and spokes is the best set-up for the Philippines now since other ports are no longer viable for businesses due to high costs," Suazo said.