Shipping time bomb ticks as thousands of Filipino sailors get stuck

Shipping time bomb ticks as thousands of Filipino sailors get stuck
Genshen L. Espedido April 17, 2020 https://www.bworldonline.com/shipping-time-bomb-ticks-as-thousands-of-fi...

VENCITO U. OPEN, 31, is one of about 50 Filipino seamen who have been stranded in a cramped dormitory in San Andres — Manila’s second-most densely populated district — jobless and about to become penniless after his flight to Saudi Arabia was canceled when the government locked down the main Philippine island of Luzon to contain a novel coronavirus pandemic.

The building owner had threatened to close the two-story dorm after many of them missed their daily rent of P80 and for fear that the virus could spread among the transients, the messman from Cagayan de Oro province said.

“We badly need electric fans because it’s hot and humid inside,” Mr. Open, who shares a room with five other seafarers, said by telephone. “The water pressure is low and life gets harder each day. Village officials asked for our names, but we have yet to receive any help.”

The Philippines is one of the world’s biggest suppliers of sailors on international ships, and apart from the jobless seamen stuck at home, thousands more have been stranded on cargo and cruise ships amid global travel curbs.

Industry groups have been lobbying to lift travel restrictions on seafarers to defuse a shipping sector time bomb.

The pandemic that has sickened two million and killed more than 130,000 people worldwide is expected to hit the global shipping industry, said George N. Manzano, dean of the University of Asia and the Pacific’s School of Economics.

“This would put a drag on the employment of seafarers,” he said in an e-mailed reply to questions. “Filipinos make up a significant portion of the global seafaring community, and many of them have started to feel the impact of the health crisis.”

Of the $30.1-billion cash remittances sent home by Filipino workers overseas last year, 22% or $6.5 billion came from seamen, who make up a quarter of the Philippines’ more than two million workers abroad, according to data from the central bank.

MODERN HEROES
Personal remittances — whether in cash or in kind and capital transfers between households — hit a record $33.5 billion last year, a 3.9% increase from a year earlier and accounting for almost a tenth of the Philippine economy, data showed.

The data only counted money sent home by the country’s modern heroes through official channels such as banks and remittance centers.

“Remittances provide a steady stream of foreign exchange to help offset the widening trade gap and limit the current account deficit,” Nicholas Antonio T. Mapa, a senior economist at ING Bank N.V.-Manila, said in a note.

“Together with business process outsourcing receipts, overseas Filipino remittance flows augment domestic wages, translating into potent purchasing power to fund household consumption, and even capital formation,” he added.

But the coronavirus pandemic poses a risk to remittances this year, as travel restrictions and the closure of some companies mean fewer Filipino workers being deployed overseas.

“The outbreak also forces people to go into quarantine or affects consumption patterns which could have an adverse impact on the service industry, where most overseas Filipinos are employed,” Mr. Mapa said.

“The recent plight of cruise ships around the world will likely put pressure on cruise liners and the hospitality industry as a whole, making it difficult for Filipinos to send home remittances should their salaries be curtailed or they lose their jobs altogether,” he added.

The government has repatriated more than 14,000 Filipino workers during the health crisis, mostly seafarers displaced by the pandemic, according to the Foreign Affairs department.

Overseas Filipinos’ failure to send money home to their families “may have adverse effects on the Philippine economy in the short and medium terms,” De La Salle University (DLSU) Economist Tereso S. Tullao, Jr. said.

Cabinet Secretary Karlo Alexei B. Nograles earlier said the coronavirus disease 2019 (COVID-19) would probably shave 0.8 percentage point off the growth in personal remittances this year, with the total amount expected at $34.2 billion.

Cedric V. Caguioa, a marine operations superintendent at Maersk Tankers, cited “massive disruptions” in the shipping industry caused by the COVID-19 pandemic.

“We could no longer berth and do cargo operations or what used to be routine husbandry — crew changes, supplies and provisions — at some ports that are now considered a no go,” he said in an e-mail.

“It led to a freeze in the businesses of some shipping lines, while also affecting port employees who are now out of work due to the halt in port operations,” he added.

Mr. Caguioa said crew morale is “very low,” many of them in constant fear of getting infected with the coronavirus for which there is still no vaccine.

“There are very limited ports that accept crew changes and, more importantly, seafarers are affected by the thought that they are not with their families in these trying times,” he said.

WAITING GAME
The spread of the coronavirus has resulted in many countries closing their borders and restricting port entry, Guy Platten, secretary-general of the International Chamber of Shipping, said in a statement on the group’s website.

“Limitations on crew change (the replacement of one of the ship’s crew members with another one) have the potential to cause serious disruptions to the flow of trade,” he added, noting that about 90% of goods that people use are transported by sea.

DLSU’s Mr. Tullao said the global recession could be extended if the travel restrictions on seafarers continue.

“Countries recovering from the COVID-19 pandemic may find it difficult to import or export goods because the manpower for maritime services is restricted,” he said. “This will further lengthen the global recession.”

The container throughput index fell by 10.9 points to 102.5 in February from 113.4 in January, according to the Leibniz Institute for Economic Research and the Institute for Shipping Economics and Logistics.

The index, which is an indicator of global economic activity, includes information on container throughput in 89 international ports, which account for about 60% of global container throughput.

“The halt of industrial production due to the COVID-19 pandemia and the related drop of imports and exports is likely to show its full effect in March only,” the institute said on its website.

Back home, the Maritime Industry Authority (Marina) said about a third of shipping operations had been affected by the Luzon-wide lockdown.

Mr. Open, the messman from Cagayan de Oro, said he couldn’t do anything but wait for his job agency to reopen once the lockdown is lifted.

“Most of us have signed our contracts. We’ve lost communication with our employment agencies in Manila because they’ve been closed,” he said in Filipino. “All we can do now is play the waiting game.”