It is disappointing to recognize that foreign shipping lines carry ALL Philippine containerized imports and exports. No Philippine flag carrier participates for several decades already.
That can and may change if and once the Maritime Industry Authority (Marina) permits domestic ship owners or shipping lines to operate a Philippine flag container shipping line to operate within Asia regionally, as well as to and from the Philippines, under one registry.
In that case, local shipping lines will have to measure up and meet the international standards set forth by the International Association of Classification Societies (IACS), which may be good for all, including its crew and the public.
If some local shipping lines, MCC and IRIS Logistics, per example, can comply with the IACS standards—others can as well.
In contrast, our neighbors have their flag shipping lines carrying their international trade. The Philippines has none.
With investors willing to fund our international shipping line, Marina now has an opportunity to let the world see us carrying at least some of our goods.
And participate in clean competition with others to participate in this regional market for their transports, same as they compete for ours. The beginning of the Philippine “Blue Economy.”
Our four Philippine flag commercial airlines, i.e., Cebu Pacific, Phil Air Asia, Philippine Airlines, and Skyjet, carry most of the country’s international and domestic cargoes.
A Philippine Flag, container shipping line catering to foreign and domestic shipments may do the same once realized.
What will the Philippines/the Philippine government gain by allowing Philippine flag vessels to operate domestically and internationally in one registration?
The Philippine registered company will pay local income and other taxes for businesses done here and abroad.
Foreign registered shipping lines pay carriers taxes but no income or other taxes in case of substantial destination charges/services, even as they claim these charges not to be part of “freight.” Neither do they pay taxes locally for freight income generated abroad.
Access to foreign financing for the purchase of ships will be enabled if the ship mortgage law will be amended by the government
Freight revenues, profits, and taxes stay in the country instead of being remitted abroad
Importers will be protected from the imposition of excessive surcharges. They will now have alternative options to import goods at lower costs due to real competition in a functioning market.
As a consequence, local consumers will buy imported products at a reduced landed cost as frivolous surcharges are gone.
This project will pave the way for all domestic carriers to consider going international, thereby giving work to displaced seafarers for as long as the local vessels comply with international maritime safety standards.
Once domestic companies start to engage in international trade, foreign-flagged carriers will have competition from Philippine flag carriers
Government imports such as rice, sugar, G to G projects can and will be carried by Philippine flags as the flag law requires
Per research done by the United Nations Comtrade, Thailand, and Vietnam, exports to the Philippines in 2019 were $6.47 billion and $3.46 billion, respectively.
For 2019, the Philippines imported $112.9 billion and exported $70.3 billion worth of goods worldwide based on data gathered.
By value, the Philippines exported 67.7 percent to Asian countries and imported 78.8 percent from their fellow Asian countries. Imagine all the possible benefits if at least some of these trading activities will be carried by Philippine flag shipping lines servicing Intra-Asia routes.
The good news is that Marina has formed a working group to evaluate these arguments and, if found meritorious to establish what needs to be done to implement change.
In partnership with the private sector, Marina should, as they may do already, study the best way to attract investments in shipping that will uplift the country’s flag registry and the Philippines becoming a leading maritime services center in the region.
Let us create the Philippine blue economy:
The role of shipping in the Philippine economic growth
WE started looking at “The role of shipping in economic growth” already in 2018. Being focused on creating economic opportunities for 2021 and beyond, it makes sense to see the shipping sector as part of the Maritime Blue Philippines’s economic potential.
Why now? Shipping in Asean becomes more critically crucial after global trade is affected by the policies in Washington, and Europe is looking at Asia as a focus for trade and investments.
Source: https://businessmirror.com.ph/2021/02/16/moving-philippine-foreign-trade-in-and-out/