Du30, Widodo: New backdoor shipping route will boost commerce in ASEAN

April 30, 2017 - 3:32 PM
Widodo Duterte seated
Indonesian President Widodo and President Duterte in discussion of common interests. Philstar file photograph

DAVAO CITY, Philippines – President Rodrigo Duterte and Indonesian President Joko Widodo on Sunday led the launch of the newest route of the roll-on roll-off ferry service that links Davao and General Santos cities to Bitung, Indonesia, considerably fast-tracking the shipping of goods and boosting commerce.

At half past nine, the two leaders, fresh from the 30th Association of Southeast Asian Nations (ASEAN) that concluded its 30th Summit Saturday, proceeded to Kudos Port in Sasa, Davao City.

The Davao-General Santos-Bitung Indonesia route is seen to speed up the transport of goods between the Philippines and Indonesia, as well as with their ASEAN neighbors Brunei and Malaysia.

From the average three to five weeks that it now takes to ferry goods between the two points, the new RORO route makes it possible to ship products in one and a half to three days, officials said.

Duterte outlined the benefits of the new shipping route, and affirmed the Philippines’ commitment to every measure that will promote inclusive growth not just for the Philippines but also its ASEAN neighbors.

Speaking after Duterte, President Widodo expressed confidence that the new shipping route “represents new opportunities” that in turn will also promote new businesses for the peoples of ASEAN.

He thanked Duterte for his “extraordinary commitment” in making the new shipping route possible, adding, “may this ocean transport service, this shipping route, stand as a symbol of the friendship and partnership between our peoples.”

Shipping costs down
The new shipping service is weekly.

Consequently, the cost of shipping could go down significantly.

Among the goods seen to be covered in this route are agriculture products, construction materials, animal feeds, fertilizer, ice cream, poultry and synthetics.

The RORO service is one of the priority projects of the Brunei Indonesia Malaysia Philippines-East Asian Growth Area (BIMP-EAGA) and is envisioned to be the first of several other strategic new routes.

The Davao–GenSan–Bitung route is one of the three ASEAN RORO priority routes identified in the JICA Feasibility Study on the Establishment of an ASEAN RORO Shipping Network, which was adopted by the 25th ASEAN Maritime Transport Working Group Meeting in 2013. The other two routes are the Dumai–Malacca and Belawan–Penang–Phuket.

The establishment of efficient and reliable shipping routes including the ASEAN RORO is one of the maritime initiatives under the Roadmap towards an integrated and competitive maritime transport in ASEAN and maritime transport-related measures under the ASEAN Economic Community (AEC) Blueprint, Master Plan on ASEAN Connectivity (MPAC) and Brunei Action Plan 2011-2015 (BAP) and the Kuala Lumpur Transport Strategic Plan 2016-2025 (KLTSP).

Apart from being more time-efficient, the new route is also cheaper with savings estimated to about $1,500 (PHP 75,000) per TEU, creating revenue for local businessmen and the government, according to an earlier briefer by the DOTr.

“Having a shipping route such as this is crucial for any maritime region. Sea linkage will strengthen our economies and our partnerships in other areas of development. And it will also improve the quality of life of our people because local businessmen and traders will directly benefit from this,” said DOTr Secretary Art Tugade.

Maiden voyage
Asian Marine Transport Corporation will initially be providing a weekly shipping schedule at a vessel capacity of 100 twenty-foot equivalent unit (TEU). Moving forward and in order to sustain the expected growth in demand in this route, other vessel operators are foreseen to show interest in plying the route.

Mindanao products such as fresh fruits, poultry, meat, coffee blends, fishing supplies, and synthetics were identified for export to Indonesia. On the other hand, Bitung, a city on the northern coast of Sulawesi known for rich marine life, will import coconut, copra, corn, high value crops, soya products, coffee beans, sugar, cement, and charcoal.

Stronger trade relations
The opening of a shorter sea linkage is expected to strengthen trade relations between the Philippines and Indonesia, as well as stimulate other areas of developments such as foreign investments and tourism. It is also seen to contribute greatly to the development of the Mindanao region.

A task force comprising staff from DOTr, Department of Trade and Industry, Department of Agriculture, and other concerned agencies has been formed to ensure the smooth delivery of the project. Members of the task force will be going to Bitung next week to check on port readiness and other compliance concerns.

The task force is also encouraging private companies to use the service.