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Exporters reeling from port-congestion losses

Exporters reeling from port-congestion losses
Elijah Felice Rosales -January 1, 2019

Container vans pile up in Manila North Harbor being readied to go to their destination.
EXPORTERS are demanding that the government and shipping lines resolve the problem of empty containers in ports, a situation that is slowing down cash flow and causing delivery problems on both imports and exports.

In a statement, the Philippine Exporters Confederation Inc. urged the government to stop denying there is port congestion and instead address the problem head-on. Philexport President Sergio R. Ortiz-Luis Jr. said short-term and long-term measures must be implemented.

“This is an issue that needs to be solved first in the short term and eventually with institutionalized long-term measures. The government should accept that this is a real problem that is causing very serious cash flow and delivery problems on micro, small and medium enterprises [MSMEs], especially exporters,” Ortiz-Luis argued.

Designs Ligna Inc., a furniture exporter and local retailer, has been experiencing delays in the delivery of its imports.

Designs Ligna President Nicolaas de Lange said this takes a toll on his firm’s production and cash flow.

“We have been experiencing delays of an average of two weeks on our imports. For us MSME-exporters who rely on imported raw materials, it heavily affects our schedule and cash flow,” de Lange said.
Government in denial

The government, exporters lamented, has been denying all this time that there is port congestion, even as meetings at the Export Development Council, which include truckers and container yard operators, confirmed there is.

Truckers and container yard operators pointed out there is a need for shipping lines to build their own yards to park these empty containers. In the short term, they said shipping lines have to send sweepers to remove these empty containers to decongest the ports and container yards that are at their full capacity.

However, shipping lines have not reportedly made any such move so far, presumably due to cost issues, container yard operators revealed. De Lange said that MSMEs are being charged by shipping lines about $275 for container imbalance fees, and said “this should be enough for them to move their empty containers out.”

Container imbalance fees are charged for relocating large numbers of empty containers between countries where there is trade imbalance.

The Philexport said it is coordinating with the government, particularly the Department of Trade and Industry, Bureau of Customs, Philippine Ports Authority, Association of International Shipping Lines, Philippine Chamber of Commerce and Industry and container yard operators in coming up with a solution to this issue.