Several business groups on Friday, January 27 have urged the Senate and the House of Representatives to look into the alleged anomalous issuance of an administrative order released by the Philippine Ports Authority (PPA) which they believe “will worsen the inflation in the country.”
Speaking in behalf of the Philippine Chamber of Commerce and Industry (PCCI), Federation of Filipino-Chinese Chamber of Commerce and Industry, Inc. (FFCCCI) and other export groups, Patrick Ronas, President of the Association of International Shipping Lines, Inc. warned that the Administrative Order No. 04-2021 which proposes an additional container monitoring system, supposedly as an additional policy to curb smuggling activities in ports, would directly affect ordinary Filipino consumers who are already reeling from record-high inflation.
AO 04-2021 puts in place a Trusted Operator Program-Container Registry Monitoring System (TOP-CRMS) and Empty Container Storage Shared Service Facility (ECSSSF), a proposal which, Ronan said, has been consistently and vehemently opposed by stakeholders since the first public consultation that was held in June 15, 2021.
The government is allegedly poised to start implementing AO No. 04-2021 in the middle of this year 2023.
“We appeal to the President to intervene and stop the PPA from implementing AO No. 04-2021,” said Ronas in behalf of trucking, shipping lines, exporters and supply chain traders who were present during a press conference at the World Trade Center, i
“We appeal to our senators and congressmen to investigate the anomalous issuance of AO 04-2021 and urge the PPA to revoke the policy,” he said.
“AO 04-2021 will worsen the inflation in the country. The PPA fails to consider that the ultimate victim of these additional costs is the ordinary Filipino consumer who is already bleeding from an inflation rate of 8.1 percent. The policy will result in astronomical increase in the prices of basic food and other commodities,” Ronas added.
Based on the estimates of the group, the additional insurance, transaction and trucking fees to be imposed by TOP-CRMS/ECSSSF will result to an almost 50 percent increase in the cost of importing goods, and could lead to a staggering additional annual import cost estimate of at least P35-billion.
But the TOP-CRMS/ECSSSF, stakeholders insist, “was not designed to address smuggling” and neither is it a solution to port congestion.
“We laud and fully support the adminsitration’s fight against smuggling and we are one with the government in finding effective solutions. We, however, urge the administration to carefully assess whether programs being sold to the public as a ‘solution to smuggling’ are indeed as claimed,” Ronas said.
“The solution to port congestion lies in the development of port infrastructure and maximizing the assets that PPA already has and not what it will still acquire, accredit or purchase,” he also said.
Aside from the PCCI, FFCCI, also present during the press conference are executives from other business groups such as the Philippine Exporters Confederation (PHILEXPORT), Supply Chain Management Association of the Philippines (SCMAP), Philippine Association of Meat Processors, Inc. (PAMPI), Philippine Multimodal Transport and Logistics Association, Inc. (PMTLAI), Alliance of Concerned Truck Owners and Organizations (ACTOO), Alliance of Container Yard Operators of the Philippines (AYCOP), the Association of International Shipping Lines, Inc. (AISL), Association of Off-Dock CFS Operators of the Philippines, Inc. (ACOP), Customs Brokers Federation of the Philippines (CBFP), Pasig Port Users United, Philippine Liner Shipping Association (PLSA), Philippine Ship Agents Association (PSAA), Port Users Confederation of the Philippines, Inc. (PUCP), Practicing Customs Brokers Association of the Philippines (PCBAPI), United Portusers Confederation of the Philippines, Inc. (UPC).
In an open letter to President Ferdinand “Bongbong” Marcos Jr., stakeholders also claim the PPA AO No. 04-2021 does not comply with the basic requirements of the Constitution, laws and international best practices. According to them, the policy is also inconsistent with the Philippine Competition Act.
They also scored the PPA for not conducting a Regulatory Impact Assessment before the issuance of the policy and for not providing any valid explanation about the administrative order despite the objections to the TOP-CRMS/ECSSSF.
“TOP-CRMS/ECSSSF will require truckers and other service providers to register under one system, which would then nominate and assign them to individual transactions (i.e., empty reposition). This demolishes the autonomy of shipping lines and truckers to negotiate, manage and monitor their current and prospective vendors,” they explained.
“This feature in the proposed system creates a monopoly where multiple service providers are at the mercy of the winning bidder for TOP-CRMS, a serious concern under the Philippine Competition Act,” they also pointed out.
“The PPA’s failure to analyze the impact of TOPS-CRMS and coordinate with stakeholders could lead to a repeat of the 2014 port congestion fiasco,” the business groups warned.
The stakeholders also said that there is wide consensus among them that the PPA’s proposed additional monitoring system “will end up derailing the (Marcos) administration’s economic recovery efforts.”