Accelerated streamlining of Customs procedures, use of supply chain analytics, and investment in warehouses are just some of the recommendations for the logistics sector put forward by a government technical working group to mitigate economic impact of the coronavirus (COVID-19) pandemic.
The recommendations form part of “We Recover as One”, a report by the Inter-Agency Task Force for the Management of Emerging Infectious Diseases (IATF) Technical Working Group for Anticipatory and Forward Planning (TWG for AFP) led by the National Economic and Development Authority (NEDA).
According to the NEDA, the report features three major parts: “reduce the people’s feeling of uncertainty through making information available to respond to some of the pressing questions of various stakeholders; recommend programs and strategies to mitigate the economic impact of the crisis on consumers and business; and recommend policies and programs to enable the country and the people to adapt to the “new normal” state of economic activities.”
The report noted that the implementation of quarantine restrictions, particularly the enhanced community quarantine (ECQ) in Luzon, and various interpretations on quarantine policies “held up cargoes and hindered delivery trucks carrying food and other basic items needed by people in Metro Manila and the rest of Luzon”.
Manufacturing firms have also been unable to operate at full capacity due to problems in delivery of raw materials, late shipments, cancelled export or import orders, loss of buyers or suppliers, and logistics cost increases.
The ECQ likewise heavily impacted the transportation sector with all passenger land and sea services suspended during the period. International and local flights were largely cancelled, too.
After the ECQ is lifted, the report recommends the use of NEDA’s Supply Chain Regulatory Impact Assessments and the recently-launched Supply Chain Analysis (SCAn) Dashboard to monitor and address supply bottlenecks across the country.
The impact assessments and SCAn Dashboard should be coupled with close coordination among implementing authorities, local government units, and the private sector to avoid supply gaps and spoilage of perishable goods such as fish, meat, fruits, and vegetables.
Other report recommendations:
- Accelerate streamlining of Customs procedures to avoid port congestion.
- Put in place an efficient system of tracking and tracing of shipments using the latest available technology.
- Increase investments in warehouses, cold storage facilities and paperless transaction systems.
- Fast track implementation of TradeNet, the government’s online trading facilitation portal that will function as the country’s National Single Window, allowing traders to connect with peers in the Association of South East Asian Nations. The report said TradeNet needs to be swiftly implemented to help reduce the cost of engaging in trade and facilitate movement of cargo through online processing and inter-agency certification that ensures the authenticity of digital documents. TradeNet can also be linked to online payment systems to ease payment procedures for trade documents.
- Establish a crisis communication management system among exporters, importers, and the government to ensure seamless movement of cargoes. “The initial confusion related to exemptions on movement of cargo during the ECQ highlighted the need for the establishment of a crisis communication management system that will specify the protocols and procedures in critical or emergency situations,” the report said.
- Develop a database of importers and traders for easy issuance of permits and passes. The report said it will be useful for the national government, LGUs, and the private sector to have an integrated website that tracks real-time information on cargo release, availability of supply, production, and inventory.
- Revive discussions in regional forums to develop regional stockpiling of essential goods. “Rather than working in harmful silos, countries will be more effective in crisis response through regional cooperation,” the report noted.
- Formulate a logistics trade flow for the movement of essential items within the ASEAN region to reduce the country’s vulnerability to supply constraint.
- Scale up and diversify products to minimize vulnerability and take advantage of opportunities for shift in business processes and consumer preferences. While demand is likely to go down for major export products (due to changes in consumer preference in partner countries, reduction in production activities, or constraints in customs operations), the report said the possible shift to or focus on electronic products and equipment provides an opportunity for the country to be part of the value chain for production of robots or installation of artificial intelligence in various systems. It added there is a window of opportunity for exports of medical equipment, supplies, testing kits, and other medical related articles as demand for these products is unlikely to go down until a vaccine is found and mass produced.
- Strictly enforce phytosanitary protocols to ensure regulated and prohibited cargoes are not able to enter the country. “To ensure that our territory remains safe against trade of wildlife species that may be host to various diseases, there may be a need to issue appropriate administrative orders that would reiterate strict compliance with established rules, and impose higher penalties for any violation,” the report stated. Relevant agencies need to invest in detection equipment and hiring of properly trained quarantine personnel to strengthen their capability to monitor prohibited and regulated articles, the report added. These measures, it noted, will help expedite the processing of sanitary and phytosanitary certificates for faster release of goods at ports.
- Ensure unhampered movement of agriculture and fishery goods and services for the agri-fishery sector through efficient transport and logistics systems. This would involve construction of better road and transport infrastructure, as well as sufficient and strategically located facilities such as wholesale food terminals and trading centers, warehouses, cold storage and refrigeration facilities, mobile storage, mobile marketplaces, rolling stores, and foodbanks.
- Amend the Philippine Economic Zone Authority Act and other related laws on the establishment of export zones.
- Amend the Customs Modernization and Tariff Act to allow for expeditious process of tariff modification in times of crisis to augment local supply.
- Address coordination gaps between and among the national government, regional interagency bodies, LGUs, private sector, and civil society to enable whole-of-society response. “Measures to allow continuous flow of food, health services, and other essential goods and services should be established, mindful of cross-border logistics as well as rules and regulations issued at the national level and the varying capacity levels across LGUs,” the report explained.
- Fast track implementation of programs for ICT-enabled government to ensure greater public reach and safer, protected, and reliable ICT.
- Shift by national government agencies, government-owned and controlled corporations, and LGUs to “electronic and paperless systems, zero-contact policies, online transactions, and new channels for service delivery.” – Roumina Pablo