By Alma Argayoso / TSO, PTIC Jakarta
While the initiative has stalled for some time, the interest in linking Davao and General Santos to Bitung in North Sulawesi has remained high, given the economic importance of this project to the two countries.
At its heart, the Davao/General Santos-Bitung route will connect two major islands—Mindanao and Sulawesi—and allow local businessmen to engage in international trade and access new markets. The study of USAID Philippines on “Advancing Competitiveness in the Philippines”, or the Compete Project, said Indonesian entrepreneurs can tap the Mindanao market, which has a population of 21.5 million. Likewise, Filipino businessmen can access Sulawesi’s market of 17.5 million individuals.
The sea connectivity will also enhance economic and trade relations between the Philippines and Indonesia. Economic relations have been growing steadily over the last five years. Bilateral trade has in-creased at an average rate of 4 per cent, from $3.624 billion in 2013 to $3.681 billion in 2015.
The DGB Roro shipping service will play a key role in this, bringing Mindanao and other dispersed and isolated areas in Sulawesi and the eastern part of Indonesia closer together. The sea route will facilitate a faster, easier and cheaper movement of goods and services between the two regions.
For the Philippines, the initiative will open up new trade and investment opportunities for businessmen in Mindanao. Entrepreneurs could pursue opportunities in the export/ import of raw materials and finished goods; joint production schemes (i.e. combining resources and production capacity to export to overseas markets), joint-venture agreements in agribusiness and manufacturing, tourism and education exchanges, among others.
For Indonesia, the importance of this sea linkage is in line with the vision of President Jokowi (Joko Widodo) of developing the outer fringes of Indonesia, particularly the eastern part, and connect them with other markets to promote growth. The route will facilitate direct trade not only between the Philippines and Indonesia, but also serve as a transhipment option for cargoes originating from East Asia bound for Bitung, and vice versa.
In addition, this sea connectivity complements Indonesia’s ambition to become a global maritime fulcrum by maximizing the use of regional sea lanes to improve bilateral ties with its neighboring countries.
Indeed, the opportunities being offered with the opening of this new route will bring mutual economic benefits to the Philippines and Indonesia. The 50th founding Anniversary of Asean and the Philippines’s Chairmanship of Asean is an opportune time to launch this priority initiative, which demonstrates the Philippines’s commitment to advance the Asean Connectivity agenda. Further, it will show progress and credibility on the implementation of the Asean Roro Shipping Network and inspire greater use of international Roro shipping to help facilitate the movement of goods across the region, and thereby improve economic cooperation within Asean.
Kudos to the Philippines and Indonesia for pushing this initiative. I couldn’t be prouder for the members of the Interagency Task Force and the private-sector players who worked tirelessly to make this happen.
At the end of this month, during Widodo’s state visit to the Philippines, coinciding with the Asean and Brunei Darussalam-Indonesia-Malaysia-Philippines East Asean Growth Area (BIMP-EAGA) summits and, more important, the launch of the DGB Roro shipping service, it would be a good time to share Davao’s famous durian delicacy or eat tumpeng (cone-shaped rice surrounded by assorted Indonesian dishes served as a special dish to celebrate an important occasion) together with our Indonesian brothers and friends.