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PH container depot operator banks on Davao for growth

Despite its many problems Davao, in southern Philippines, remains an attractive place for business, according to a container depot operator based in the area.

“Right now is really a tough time in Davao,” IRS Eastern, Inc chief operating officer Octavio De Leon said in an interview at the sidelines of a recent Container Depot Alliance of the Philippines (CDAP) gathering.

IRS, which maintains a 2.5-hectare container depot in Davao, is a member of CDAP.

“However, we expect this (situation) to be temporary; we just need to be patient. While waiting for volume to pick up, we injected at least P35 million to expand our yard (to cope with) future demands.”

Typhoon Pablo (international name Bopha) recently pummeled certain parts of Davao, decimating about 10,000 hectares of banana plantations and damaging 4,000 hectares more dedicated to other fruits.

It does not help that China also earlier this year imposed stricter quarantine requirements on Philippine fruit exports after discovering pests in some shipments. This affected Davao particularly since the area accounts for 80% of the country’s banana exports.

IRS’s weekly volume is down by at least half from 6,000 twenty-foot equivalent units (TEUs) to between 2,500 and 3,000 TEUs this year. The effect of the typhoon has yet to be factored into the volume.

“Despite the current problems, Davao will continue to be one our main growth areas considering the huge investments being put in, particularly in the supply chain sector,” De Leon said.

Other companies are also betting on Davao. Anflocorp Group recently broke ground on its Davao International Container Terminal in Panabo City, Davao del Norte, The facility is expected to start operations by first quarter 2013.

Hijo International Port, located in Tagum, Davao del Norte, will be improved by a subsidiary of International Container Terminal Services, Inc in order to handle about two million twenty-foot equivalent units.

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