Higher storage fees detrimental to shippers, economy – Philexport

MANILA, Philippines — Exporters warned that the proposed 32 percent hike in storage fees for foreign containerized cargoes at ports as such would hurt shippers and the economy.

Philippine Exporters Confederation Inc. president Sergio Ortiz-Luis Jr. recommended that the planned cargo storage rate increase undergo a regulatory impact assessment (RIA) in line with the Ease of Doing Business law.

“This is to prevent causing undue regulatory harm that might arise from the higher charges. As proposed, we are already seeing the immediate harm they will cause to shippers and the economy in general,” Ortiz-Luis said in a letter to Philippine Ports Authority general manager Jay Daniel Santiago.

Last Oct.18, the PPA conducted a public consultation on the planned storage fee increase for foreign containerized cargoes at all its administered ports in the country.

The PPA has proposed to increase storage fees for import, export, and transshipment containers by 32 percent and 150 percent surcharge on the corresponding storage rates with increase for reefer containers.

The storage charges apply when foreign cargoes, which include import cargoes as well as export cargoes and transshipments, stay at PPA ports beyond the free storage period.

The proposed hike aims to achieve optimal use of the container yard and encourage immediate withdrawal of containers to prevent congestion.

Aside from the review, Ortiz-Luis recommended that no fees be imposed in situations when containers overstay due to reasons beyond the shipper’s control.

He also said national and local holidays should be excluded in counting the days when storage charges apply, and to have the rate of increase be based on the average inflation level recorded since the last fee adjustment.

He added that shipping lines should be urged to put up their respective yards for parking containers or to keep track of container yards with available storage space.

The umbrella organization of exporters emphasized in the letter dated Nov. 8 that it has yet to receive a copy of the PPA’s proposal.

Despite repeated email requests, the group said the group has not received a copy of the document, which should have been the basis for its position on the matter.

“This position was then made based on the pieces of information that were quickly flashed on the Zoom screen during the hearing,” Philexport said.

During the PPA hearing, Philexport already raised that “any additional cost will hurt the economy and stakeholders that are facing inflation and weak global economy.”

Given the recent increase in transport fare, minimum wage, and prices of basic commodities, the Supply Chain Management Association of the Philippines also said the proposed rate increase was ill-timed.

Other stakeholders have proposed to defer the rate hike or implement the increase in tranches over a three-year period.