MANILA, Philippines - Former Senate President Aquilino Q. Pimentel Jr. called yesterday for the overall deregulation of the port construction industry to ensure the quick delivery of extensive port infrastructure and accelerate the completion of the country’s nautical highway system.
Pimentel made the proposal in the wake of the Philippine Ports Authority’s (PPA) decision to allocate almost P400 million for the rehabilitation of Macabalan port in Cagayan De Oro City.
Pimentel said the government should emphasize projects that would attract even medium-sized investors.
“More feeder ports are ideal. They’re cheaper to build and will encourage businessmen to invest in small and medium-sized roro vessels,” he said, adding that feeder ports should be located just four to six hours sailing from each other.
Feeder ports, Pimentel said, “would allow goods to hop from island to island, without incurring land transportation costs.” He added this is better than the current system where only one or two major port hubs cater to the needs of entire regions, resulting in “effective monopoly of service.”
The current system, the former legislator said, “discourages farmers from producing more, because of the high cost of land transportation. Shipping goods between certain regions is more expensive than from other countries. Either situation impairs our food self-sufficiency.”
He said that “given the historical trend where fuel prices double nearly every 10 years, hauling quantity by sea is a future-proof solution.”
Pimentel emphasized that the lack of port infrastructure is a “disincentive” to trade and productivity. “We’re still only 81-percent food self-sufficient,” he said. “That’s likely to decline as land transportation cost [for bulk goods] keeps increasing, therefore discouraging the farmer from producing more,” he said.
“Allowing more suppliers of infrastructure projects would immediately translate to lower prices of goods and faster movement of goods. Knowing that their goods can be sold, farmers suddenly have an incentive to increase output.”
Pimentel said the PPA was spending too much on existing ports, and not spending enough on developing new, smaller ones.
He cited the “astronomical costs” of two existing PPA projects, namely the renovation of the Tacloban port, up for bidding for P397 million, and the construction of Pulupundan port in Negros Occidental for P715 million.
“By comparison, the French roro ports are just P83 million according to the NEDA grant formula,” he said.
Pimentel expressed confidence that incoming Transportation and Communications Secretary Mar Roxas would be able to rationalize and define an improved ports strategy to rapidly develop the Strong Republic Nautical Highway System (SRNHS).
Pimentel, who hails from Cagayan de Oro City, said Macabalan is the only major port serving the entire Cagayan De Oro and neighboring provinces.
With the French government-assisted modular roro ports project, Pimentel said, the country has an option to build complete port facilities for less than half of PPA’s allocation.
“That’s the benefit of competition,” he stressed, adding that the French modular roro ports priced at P143 million and payable over 15 years using overseas development assistance (ODA) funding is a “cheap investment for port infrastructure.”