Shipowners air lending woes

CEBU, Philippines - Shipping companies in Cebu prefer to borrow from private banks even if the government offers assistance to improve services amid high fuel prices.

Chester Cokaliong, president of the Visayan Association of Ferry Boat and Coastwise Shipowners Operators (VAFCSO), said that aside from the policy problem they have with the Maritime Industry Authority, the biggest problem the shipping industry is facing, include the constant fuel price increase.

MARINA has a lending program for shipping industries in partnership with the Development Bank of the Philippines in line with the roll-on/roll-off program of then President Gloria Macapagal Arroyo.

“Most shipping companies, we go to private banks because of lesser paper works, lesser red tapes. Very few shipping owners availed of DBP because of many requirements and their rates,” said Cokaliong during the 888 News Forum at Marco Polo Plaza.

Although Cokaliong did not divulge the private banks’ rates that were offered to them, DBP reportedly offered a loan to shipping owners with a two percent interest rate.

“If it is two percent we will go there, everybody will go to DBP,” Cokaliong said, adding that “DBP is not competitive.”

During the forum, Cokaliong said that fuel price increases has greatly affected the industry as ships don’t sail without fuel, but his fleet of ships for one, is still offering low fare rates to passengers.

Cokaliong explained that they are just aiming for volume of cargos because passengers are seasonal.

“We are trying our best to get cargoes if the passengers are off-season. We are trying to get more cargoes in order to offset the lack of passengers,” he said.

Aside from fuel price increases, the shipping industry is also threatened by MARINA’s alleged failure to give them due process before suspending their fleets following accidents at sea.

MARINA reportedly suspends the vessels immediately without undergoing due process which badly paralyzes the shipping industry in Cebu, where much of economic and trade activities rely on maritime transportation.

This year, MARINA suspended the fleets of Trans-Asia Shipping Lines, Island Shipping and Weesam Express after some of their vessels experienced engine trouble at sea.

The three companies were reportedly penalized before the hearing took place.

Cokaliong complained that Marina violated Sections 10 and 18 of Republic Act 9295 or the “Domestic Shipping Development Act of 2004,” which prescribes that suspension of a shipping company would only be implemented “upon notice and hearing.” (FREEMAN)