Policy Support for TransportLogistics Infrastructure Development

1
Policy Support for Transport-Logistics
Infrastructure Development Enrico L.
Basilio Co-Chairman, EDC Transport and Logistics
Networking Committee Chairman, PCCI
Infrastructure Committee Director, CRC Transport
and Logistics Institute Co-Chairman. NCC Infra
Working Group EDC Representative, Pro-Performance
System Steering Committee PHILEXPORT General
Membership Meeting October 30, 2008
2
Outline

• NCC Infrastructure Working Group Policy
  Recommendations to the President
• Reduction of Transport Cost
• Impact of RO-RO on movement of goods
• Subic-Clark-Batangas Development Corridor
• Policy Concerns and Support Infra

3
NATIONAL COMPETITIVENESS COUNCIL Seamless
Infrastructure Working Group

• WB/IFC DOING BUSINESS REPORT Cross Border Trade
• WB IFC Reports indicate that the cost of
  exporting has increased
• PHILS THAI VIET
• 2007-2008 Report 800 /TEU 615
  /TEU 669 /TEU
• 2008-2009 Report 816 /TEU 625
  /TEU 734 /TEU
• In 2007, government reduced cost by 25/TEU (by
  bringing down the wharfage and scanning fee)
• CRC study recommends areas for cost reduction
  roughly 132/TEU
• Domestic Transshipment EO on Chassis RO-RO 76
• Cargo Handling Charges PPA 40
• Documentation Costs DTI-PSB and AISL
  16
• NCC endorsed the EO on Cha-RO. AO 123, chaired by
  DOTC Usec. Len Bautista, approved to endorse the
  proposed EO to OP pending report from PPA
  regarding impact on (PPAs) revenue.
• With the intervention, we can reduce cost of
  exporting to 684 /TEU.

4
NATIONAL COMPETITIVENESS COUNCIL Seamless
Infrastructure Working Group

• EXPANSION OF RO-RO NETWORK
• PGMA inaugurated the Central Nautical Highway
  through a RORO Caravan on April 27-30, 2008. Most
  RORO ports were completed in time for the
  Caravan.
• PPA is now fast-tracking completion of Eastern
  Nautical Highway
• RO-RO ports
• PGMA directed DPWH to issue and AO declaring all
  roads connecting RORO terminals part of the
  Strong Republic Nautical Highway as national
  roads.
• NMLC acquired from Korea a RO-RO vessel to be
  deployed in the Port of Subuquin, San Juan,
  Batangas this September.
• RO-RO softened the impact of the domestic liner
  shipping crisis on the movement of goods.

5
(No Transcript)
6
Strong Republic Nautical Highway
7
SRNH East-West Lateral Connection 1
8
SRNH East-West Lateral Connection 2
9
SRNH Prospective Routes
10
Impact on Economic Growth

• Increased regional trade
• Enhanced Tourism
• Area development
• Reduction in transport cost

11
Increased Inter-Island Trade
12
RORO Shipments of Agri-Fishery Products
Fruits and Vegetables
Fishery Products
Live Hogs
Rice and Palay
13
RORO Shipments of Manufactured Goods
14
Southwestern Mindanao RORO Links
15
Zamboanga City Basilan Route
Source PPA
Agricultural products like fish products, fruits
and vegetables, rubber are shipped to Zamboanga
City from Basilan (Isabela). Inbound cargoes to
Basilan include rice and palay, flour, bottled
cargoes, manufactured goods, food and other
consumer products.
16
Zamboanga City Basilan Route
Passenger traffic between Zamboanga City and
Basilan is also on an uptrend.
Source PPA
17
Roxas-Caticlan Route

• 1 RORO operator in 2003, now 3 operators
• 1 RORO ship in 2003, now 5 RORO ships

Source PPA
18
Cargo Shipments to and from Mindoro

• CALAPAN-BATANGAS ROUTE
• 85,000 MT of rice palay
• 13,000 MT of fertilizer
• Other products include corn, fruits vegetables,
  livestock
• ROXAS-CATICLAN ROUTE
• 167,000 MT of rice and palay
• 75,000 MT of sugar
• 60,000 MT of fish products
• 84,000 MT of animal feeds
• 115,000 MT of fertilizer
• 8,000 MT of corn

19
Bacolod-Dumangas Route

• 1 RORO operator in 2003, now 3 operators
• 1 RORO ship in 2003, now 3 RORO ships

20
Enhanced Tourism and Mobility of People
21
(No Transcript)
22
(No Transcript)
23
(No Transcript)
24
Roxas-Caticlan Route
Total passenger traffic reached almost 700,000
in 2006
Source PPA
25
One tourist, one job. From 2003 to 2006,
tourism receipts in Boracay grew by 50, Iloilo
by 30, Bacolod by 15 and Dapitan by 200.
26
Bacolod-Dumangas Route
Bacolod and Iloilio serve as the mid-points for
the western seaboard.
Source PPA
27
Reduced Transport Cost
28
Comparative Transport Costs
29
RORO vis-à-vis other Modes of Transport
30
NATIONAL COMPETITIVENESS COUNCIL Seamless
Infrastructure Working Group

• BATANGAS-SUBIC-CLARK LOGISTICS CORRIDOR
• The Presidents vision is to develop a mega
  logistics and transshipment hub in the
  Batangas-Clark-Subic Corridor
• Initiative will improve national competitiveness,
  reduce transport cost, decongest Manila.

31
Subic-Clark-Batangas Corridor

• Vision
• To develop Subic-Clark-Batangas Corridor as a
  Major Transshipment and Logisitcs Hub, as well as
  to decongest Metro Manila
• Challenges
• To complete the supporting infrastructures that
  will create a seamless infrastructure network
  along the corridor,
• To address major transport policy issues,
  critical to the development of SCB corridor

32
Supporting Infrastructures

• Subic-Clark-Batangas Mega Logistics Hub
• Subic Seaport New Container Terminals 1 and 2
  already completed
• Expansion of Diosdado Macapagal International
  Airport (DMIA) terminal 1 already completed.
  Terminal 2 to be built soon
• Subic-Clark-Tarlac Expressway (SCTEx) now open
  for commercial operation
• Tarlac-La Union expressway to be built soon
• Batangas International Port already completed

33
Subic Bay Port Development
Description The P8 billion port development
project involves the construction of two new
container terminals and support facilities, and
rehabilitation of existing wharves
Benefit/s The new container terminals will
increase Subic Ports capacity from 100,000 TEUs
to 600,000 TEUs. With its accomplishment, the
improved Subic Port is expected to decongest
ports in Manila. Status Terminal 1 was
completed on July 2007 and Terminal 2 on January
2008.
34
DMIA Terminal Rehabilitation and Expansion
Increased Capacity from 1M to 2M Passengers per
Year
35
DMIA Terminal Rehabilitation and Expansion
Expanded Passenger Terminal Bldg. total area
6,147 sq.m.

• Area Capacity
• Pre-departure 900 pax
• Check-in lobby 504 pax
• Baggage claim 621 pax
• Arrival area 280 pax
• Project Cost PHP 54M

Increased Capacity from 1M to 2M Passengers per
Year
36
DMIA Terminal II Proposed Configuration
Capacity min. 7M pax per
year Target Start 4th Q
2008 Target Completion 1st Q 2010
37
High Speed Rail System

• High Speed Rail connection
• - 32 minutes connection time from NAIA to Clark
• - 2-3 city stations at Metro Manila to connect
  to Clark

38
DMIA The Future Premiere Gateway of the
Philippines
39
Korea International Cooperation Agency(KOICA)
Project 2M technical grant for the Feasibility
Studies on the Master Development Plan of the
DMIA Title The Feasibility Studies for the
Master Development Plan of the
Diosdado Macapagal International Airport
Project Operator/s
Daewoo Engineering
Period of Design Work 2007. 12. 19 2008. 10.
19
40
Access Transportation Concept Design
Alignment Plan for Clark Express Rail
41
Air Policies and Issues

• Salient Features of EO 500A
• Unlimited flights
• But only on 3rd and 4th freedom rights
• Requires carriers to be officially designated

• Salient Features of E.O. 500
• Unlimited flights
• Provides for 5th freedom of rights
• Allows designated and non-designated carriers

42
Air Policies and Issues

• Salient Features of Proposed EO 500-B
• Unlimited flights
• No 7th freedom
• Gives non-designated carriers an opportunity to
  operate and to shift from charter to scheduled
  flights

43

• DMIA to be the best international service and
  logistics center in the Asia-Pacific region the
  premiere gateway of the Philippines.
• Premiere Global Gateway Airport

44
Necessary and Critical Elements for Batangas Port

• Foreign Cargo traffic volume
• International Port
• International shipping lines
• Ancillary Services (trucking, forwarding,
  logistics)

45

• FOREIGN CARGOES
• There are roughly 1,000 PEZA locators in 42
  industrial estates operating in the
  Cavite-Laguna-Batangas area that can ship in and
  out of the International Port of Batangas.

NUMBER OF ECOZONES IN CALABA AREA
Source PEZA
46

• Survey conducted recently by PEZA indicate that
  there is enough cargo volume to attract foreign
  ships to Batangas Port
• gt150 responses from 700 respondents
• Total volume of gt10,000 TEUs/month
• IMPORTS gt 8,000 TEUs / month
• EXPORTS gt 2,000 TEUs / month
• Match the imports of the exporters at 4,000
  TEUs/month (or 1,000 TEUs per week), the traffic
  will attract one vessel to call at the Batangas
  Port every week (loaded both ways).

47

• The attainment of a critical mass will make the
  program more feasible.
• In this regard, EDC/NCC Chairman Meneleo Carlos
  recommends the conduct a study the viability of a
  coastwise floating crane barge (FCB) operation
  between Batangas and its environs (Cavite,
  Manila, Bataan and Subic) to consolidate export
  cargoes to Batangas (and distribute import
  cargoes from Batangas).
• This will not only enlarge the traffic but will
  shift traffic from the road network to the sea.

48

• PORT OPERATIONS
• The terminal operator offered a 14 discount on
  cargo handling and international shipping lines
  expressed interest to call in Batangas.
• INTERNATIONAL SHIPPING LINES
• Initial discussions indicate AISLs strong
  interest on the program
• Team (PEZA and CRC) will present to the members
  of AISL on October 8, 2008 (GMM)

49

• ANCILLARY SERVICES
• Trucking Firms. Trucking will be confined within
  the Cavite-Laguna-Batangas area. Cost is expected
  to go down because the trucks will (a) cover less
  distance and (b) not be subjected to the truck
  ban.
•  
• Forwarding. Cargo consolidation will be done at
  the Port of Batangas. Will have to work on a new
  cost for the PEZA locators shipping out of
  Batangas.

50
Coastal Crane Barging
51
Subic
52
Supporting Infrastructures

• Continuous Highway from Clark to Metro Manila to
  Batangas Port
• North Expressway already completed
• NLEX-SLEX Link or North Expressway to C-5
  interconnection (on-going)
• C5 already connected with South Expressway
• Rehabilitation and Widening of Alabang-Calamba
  Section of SLEX (on-going)
• Extension of the SLEX to Sto. Tomas, Batangas
  (on-going)
• Sto. Tomas to Lipa (STAR 1) already completed
• STAR 2 connecting Lipa to Batangas City now
  passable
• C-6 Expressway to be alternative route that will
  connect NLEX SLEX

53
Supporting Infrastructures

• Metro Manila Infrastructure Projects
• Coastal Road to Bacoor (on-going)
• MRT and LRT interconnection from Monumento to
  North EDSA (ongoing)
• MRT-7 (on-going)
• MRT-3 Capacity Extension
• LRT extension to Bacoor

54
Supporting Infrastructures

• Major Railroad Projects
• Northrail Project (on-going)
• Phase 1 Caloocan to Malolos Section
• Phase 2 Malolos to Clark Section
• Northrail-Southrail Linkage Project (on-going)
• Phase 1 Caloocan to Alabang Section
• Phase 2 Alabang to Calamba Section
• On-going Southrail Project from Calamba to Lucena
  (Phase 1A) and Lucena to Bicol (Phase 1B)

55
PCCI PBC Resolutions
56
PCCI PBC Resolutions Infra Committee

• ROAD
• To encourage greater private sector participation
  in toll road development
• RESOLUTION Support the issuance of an Executive
  Order (EO) directing the Toll Regulatory Board
  (TRB) to
• (a) Automatically grant the franchise for NEDA
  ICC- approved toll road projects as
  provided for under the BOT Law.
• (b) Discontinue issuing two types of franchises
  for the same project

57
PCCI PBC Resolutions Infra Committee

• B. SHIPPING
• 1) To develop the Batangas-Clark-Subic Corridor
  as transshipment and logistics hub
• RESOLUTION support the shift of cargo
  traffic from Manila to the Ports of
  Batangas and Subic. This move will decongest
  Manila, reduce cost and improve
  competitiveness.
• To reduce domestic shipping Cost
• RESOLUTION (a) support the Issuance of an
  EO amending EO 170 to expand the RORO
  service to include the Chassis-RORO.
  This will reduce the domestic transshipment of
  domestic and foreign-bound cargoes.
• (b) supporting the permanent reduction in
  wharfage dues from 6 to 1 per 20-foot
  container

58
PCCI PBC Resolutions Infra Committee
C. AIR To increase air access RESOLUTION
urge more bilateral talks/negotiations with
other countries (key markets like Singapore,
Russia, Australia and Middle East UAE, Qatar)
to improve the countrys accessibility by
tourists and Overseas Filipinos (permanent
residents, immigrants, and overseas workers)
59
PCCI PBC Resolutions Infra Committee
D. LIGHT/METRO RAIL To enhance the mass transit
system in the metropolis and its environs
RESOLUTION (a) support the development of a
Central Terminal for the four light
and metro rail projects (MRT-3, MRT-7, LRT
1 North Extension, and proposed MRT-9) in
EDSA cor North and West
Avenues. (b) supporting the capacity
expansion and network extension of existing
LRT/MRTs, as well as the development of new
and more routes
60
PCCI PBC Resolutions Infra Committee
E. PRIVATE SECTOR PARTICIPATION
RESOLUTION support the implementation of
priority infrastructures through solicited bids
under the BOT Law. Less emphasis should be
given to unsolicited and joint venture modes.
61
THANK YOU!!!