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Wednesday, January 16, 2019

Port congestion ‘now affecting business’

THE Economic Development Committee (EDC) has endorsed to the Regional Development Council (RDC) Full Council the discussion on the congestion and over-capacity at Cebu International Port (CIP) that has affected the business community.

EDC Chairman Robert Go said CIP is congested because the goods are slow to withdraw and container yards are overcrowded.

“The congestion at the CIP is increasing the cost for the importer and exporter and will affect business. Goods are penalized for overstaying by the increase of warfage and demurrage fees to importers, even if this is not the fault of importers but are due to the delays in the approval for release by customs,” Go said.
Truck ban

Go said the truck ban exacerbates the problem since trucks cannot move out.

“Instead of a truck ban and penalizing business, the LGUs must build roads, and not incapacitate business and cause higher price on consumer goods due to many charges,” Go said.

Teresa Chan, the president of the Cebu Chamber of Commerce and Industry (CCCI), told Sun.Star Cebu that the congestion at CIP has directly affected importers and exporters who are providing jobs to thousands of people.

“This problem, if prolonged, can affect competitiveness and any additional cost of operation may be passed on by the businessmen to the customers,” Chan said.
In their discussion during their March 2 meeting, the EDC found that importers and exporters are hit hard by the CIP congestion.

Importers incur more costs as they will have to pay storage fees per container, per day in excess of the free of charge (FOC) period and demurrage charges per container per day in excess of the FOC period.

Some eporters have to pay for temporary storage near the port while waiting for vessels to arrive.

Lawyer Tomas A. Riveral, president and general manager of Oriental Port and Allied Services Corp. (Opascor), said the congestion at CIP is a big problem that needs a concerted effort from all sectors.

“Unless addressed promptly and appropriately by all concerned, this might worsen,” Riveral said.

Opascor is the exclusive cargo handling service provider at CIP under contract with the Cebu Port Authority (CPA).

Increased fees

Go said that because of CIP congestion, international shipping lines charge congestion fees and added shipping costs. Customs charges have also increased and trucking fees have gone up 100 percent.

“That translates to higher prices to consumers. Some stores are out of stocks due to the absence of raw materials to manufacture goods, thus reducing productivity,” Go said.

Go said the whole country now suffers port congestion, airport congestion and road congestion, causing a decline in Gross Domestic Products.

“Cebu is starting to feel the port congestion, higher fees and higher expenses. The port of Cebu lacks berthing spaces for ships and is too shallow for big container ships. We should build a new international port,” Go said.

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