Ferry services to boost BIMP-EAGA trade. Reduces transit time; saves cost of haulage. Weekly trips to Bitung, Indonesia from Mindanao.

Ferry to reduce costs, improve trade.

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Man is an enterprising being and continues advancing his interests till his last breath. The Filipinos, in spite of the natural and man-made adversities that this nation faces, keep advancing by the day.

Traditionally, the movement of goods between Indonesia and the Philippines was lengthy and costly. What used to take about three to five weeks to transport is now possible within 1.5 days. Thus, there is a drastic reduction in the average lead time for a consignment between Davao City and North Sulawesi.

This was because earlier they transported goods via a circuitous route involving carriage to Manila via Jakarta. From Jakarta, carrying the goods to Bitung in Indonesia involved more time.

Now, an agreement has been struck that will not only shorten the lead time, it will also lower the cost of transportation. The advantages of technology are quite clear since the intended vehicle carries about 500 containers each way.

Moreover, the new route also cuts down the cost of haulage per container. This is a huge reduction of the cost for Indonesian as well as Filipino businessmen. The businessmen earlier paid P100000 ($2, 000) over the Davao-Manila-Jakarta route for each 20 foot container.

Whereas, over the new route freight cost will only be P35,000 ($700). This is straightaway a 65% reduction in the cost and beats any profit margin by far.

In addition, the new route will obviate by far the congestion and delays on the Davao-Manila-Jakarta route. The Presidents of Indonesia and the Philippines will attend the inauguration of the new initiative.

The logistics
President Widodo and President Duterte will launch the initiative on Sunday. The initial movement on this route will be between Bitung in Indonesia and General Santos and Davao City in the Philippines.

Therefore, it is a highly profitable step to radically boost trade between members of East Asian Growth Area (EAGA). It is also an established fact that the Philippines is benefiting from trade with regional nations including China and India.

The company that is starting operations is M/s Asian Marine Transport Corp

The M/V Super Shuttle RoRo (Roll-on, Roll-off) 12 will start plying weekly. It will carry 500 twenty foot containers (TEU) to Bitung the largest port in North Sulkawesi province.

The travel time of the ferry will be 1.5 days excluding the handling and turn round time in the port areas.

Strengthening of trade links with regional hubs is the aim of East Asian Growth Area (EAGA). The BIMP group consists of:

1. Brunei,
2. Indonesia,
3. Malaysia, and
4. Philippines.

The group known as BIMP-EAGA aims to mutually benefit the other members in the fields of:
• Education,
• Tourism,
• Socio-economic initiatives, and
• Agri-businesses.

Abul Khayr Alonto, the chairman of Mindanao Development Authority (MinDA) explained the vast benefits that will result from this novel step. It provides the local business owners with easier access to international markets.

It drives innovation and expansions to the businesses which were henceforth restricted to the local markets. In fact, Alonto suggested that there was no limit to the potential for initiatives that exists.

Furthermore, Alonto pointed out a few areas which both sides may exploit. These included:
• Promotion of tourism and travel jointly and singly,
• Investment opportunities, and
• Direct links for trade and cultural exchanges.

More than any other thing, this ferry improves connectivity between regional entities with accompanying benefits. Arturo Boncato Jr, Secretary, Department of Trade and Industry stated this as the biggest achievement.

He also elaborated on the savings in terms of cost that would provide a competitive advantage to the Mindanao businesses.

BIMP-EAGA had been instrumental in introducing the products to each other in the association.

Thus, better familiarity with the other’s products creates an opening for expanding trade opportunities.

Consequently, the Mindanao products that will move via the ferry on the new trade route are:
• Fresh fruits and perishables,
• Ice cream and associated products,
• Fertilizers and Chemicals,
• Animal feeds,
• Construction materials and equipment,
• Synthetics, and
• Poultry ( Halal) products.

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Umrao Singh
umraoz.wordpress.com
Written for: Lars-Magnus Carlsson.
www.thephilippinepride.com
Friday, April 28, 2017

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