The Philippines, through the Department of Trade and Industry (DTI), is set to send a trade mission to Jakarta and Manado on 4 to 8 September in a bid to sustain the Davao-General Santos-Bitung Roll-On, Roll-Off (RORO) operations and expand trade with Indonesia.
The DTI said it is lending support to the Davao Chamber of Commerce and the Indonesian Consulate in Davao in organizing the upcoming trade mission to Jakarta and Manado.
“Sustaining the RO-RO operations, launched in April this year by President Rodrigo Duterte and Indonesian President Joko Widodo, is high on the agenda of DTI,” Trade and Investments Promotion Undersecretary Nora K. Terrado said.
“We want to see the sustained operations of the shipping service so our local entrepreneurs, particularly our small and medium enterprises in Mindanao, could begin to reap the gains from enhanced connectivity between Mindanao and Sulawesi, and the greater BIMP-EAGA region,” Undersecretary Terrado added.
The Philippine business delegation composed of government representatives and local entrepreneurs in Davao will focus on building networks and partnerships with Indonesian companies in the areas of trading, joint venture agreements, joint production schemes, and other forms of strategic partnerships.
Among the companies that are part of the delegation are Eagle Multi Purpose Cooperative, Mindanao Agriplus Corporation, Certuso Structural Speacialists Corporation, Halal Business Council, Aleson Shipping Lines, Inc. and Fastcargo Logistics Corp.
Business-to-business (B to B) meetings and networking sessions, site visits in Bitung Port as well as market and company visits are included in the mission’s itinerary.
DTI Regional Director Belenda Ambi noted that DTI expects targeted, high-quality meetings during the B2B and networking sessions. Meanwhile, market visits aim to help the business delegation to understand the Indonesian market in terms of product offerings, pricing, packaging, and competition.
“We enjoin the full cooperation of all stakeholders of both countries to maximize the opportunities being offered by the sustained operations of the route. This is a great opportunity that has been made available to local entrepreneurs to ensure that they could participate more in international business,” Ambi said.
The opening of the shipping route within the Brunei Darussalam Indonesia Malaysia the Philippine East ASEAN Growth Area (BIMP-EAGA) is expected to further enhance trading between the Philippines and Indonesia, according to the Department of Trade and Industry (DTI).
A Roll-on Roll-off (RoRo) ferry service will begin plying the Davao City-General Santos-Bitung, Indonesia route on April 28, 2017, which will provide a faster and cheaper channel of trading goods among EAGA’s key cities.
M/V Super Shuttle RoRo 14, operated by the Asian Marine Transport Corporation will provide a weekly shipping service to the route with a vessel capacity of 100 Twenty Foot Equivalent Units (TEUs).
“These developments in the sub-region complement the ongoing regional efforts towards realizing the ASEAN Economic Community 2025. It will help increase economic cooperation and will pave way for the promotion of Philippine products especially those coming from the Mindanao region,” said DTI Industry Promotion Group Undersecretary Nora K. Terrado.
In a report submitted by DTI’s Trade and Investment Center in Jakarta, it mentioned that the opening of the route is a more cost and time-efficient alternative to the usual Manila to Jakarta to Bitung route, which would take about three to five weeks of shipping time. In contrast, direct shipping through the Davao-GenSan-Bitung route will take only one day and a half of sailing (excluding port stay).
A savings of up to $1,500 (P74,000) per TEU is estimated in using this route given its $700 (P34,713) per TEU rate per 20 feet dry container as compared to using the Davao-General Santos to Manila to Manado via Jakarta route which amounts to $2,200 (P109,098) per TEU.
Among the goods identified by the private sector in Mindanao at this stage that will be shipped to Indonesia are: animal feeds, fertilizer, construction materials, ice cream products, poultry (halal), fresh fruits, and synthetics.
Initial list of import goods on the other hand include matured coconut, copra, corn, feed ingredients, lumber, cement, high value crops, vegetables, meat, peanuts, aqua products, charcoal, soya, coffee beans, and sugar.
In a feasibility study conducted by the Japan International Cooperation in 2012, the Gensan-Bitung route was selected as one of the pilot areas for a roll-on roll-off operation within BIMP-EAGA. The study also highlighted that the route can be dedicated to a freight service once shipping service requirements are in place.