High port charges burden businesses, shipping group seeks reforms

Local

RISING port charges are driving up transportation costs for businesses that rely on inter-island shipping, prompting an industry group to seek government intervention to ease logistics expenses and their impact on consumer prices.

The Philippine Coastwise Shipping Association (PCSA) renewed its call to abolish roll-on, roll-off (RoRo) terminal fees during its general membership meeting in Cebu City on Friday, Oct. 23.

PCSA Chair Lucio Lim Jr. said these fees account for 5 percent to 10 percent of total freight costs for a 10-wheeler truck, reaching as much as 15 percent on some short-haul routes.

"When logistical costs rise, food prices rise. When logistical costs increase, businesses become less competitive. When connectivity is slow and inefficient, economic opportunities become limited," Lim said.

The burden of high port charges was highlighted during the meeting's open forum, where a business representative cited soaring freight costs for construction materials shipped to Bohol.

The representative said transporting a barge of gravel now costs between P350,000 and P400,000, compared with approximately P65,000 previously, putting additional pressure on contractors.

PCSA also questioned a 2019 Philippine Ports Authority (PPA) administrative order, which Lim said increased cargo-handling rates by 500 percent to 2,000 percent.

He said these rates became the basis for port management contracts, making subsequent reductions difficult.

To reduce logistics costs, PCSA proposed treating RoRo vessels as bridges connecting islands and their ports as extensions of the national highway network rather than revenue-generating facilities.

"The ship becomes the bridge that connects one land corridor to another," Lim said.

He cited Japan and Norway, where RoRo facilities are treated as part of highway networks, allowing cargo vehicles to move between islands without comparable terminal charges.

Under the proposal, RoRo ports outside the base ports of the PPA and Cebu Port Authority would eventually be transferred to the Department of Public Works and Highways for management and maintenance.

Lim estimated that a standard RoRo port could be constructed for approximately P200 million, with relatively low maintenance costs.

The association has been pushing for the removal of terminal fees for nearly two decades.

"We've been raising the issue of RoRo terminal fees for almost 20 years," Lim said.

Beyond eliminating port charges, PCSA urged the Marcos administration to conduct a feasibility study on expressway corridors connecting production centers, ports and major markets across the Visayas and Mindanao.

Lim said the proposed infrastructure projects could be financed through public-private partnerships or long-term congressional appropriations.

"Logistics is not merely an industry issue — it is a national development issue, it is an inflation issue and it is a quality-of-life issue," he said.(RBE)