Polish the transport industry crown jewel

PORT UPGRADE: The modernization of the decrepit North Harbor in Manila, now a mere shadow of the crown jewel of the transport industry that it used to be, is long overdue.

The good news is that the waiting is about to end for the estimated one million inter-island passengers transiting annually through it and the many others, including cargo handlers and concessionaires, depending on port operations for their livelihood.

The Philippine Ports Authority is set to award by Oct. 15 the modernization contract to the winning bidder — the joint venture of Harbour Centre of the Romero family and Metro Pacific Investments Corp. led by its chairman Manuel V. Pangilinan.

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RIGOROUS TEST: Announced two weeks ago, the winning offer of the joint venture, the only qualified bidder, was P14.5 billion. The consortium passed the rigorous pre-qualification and bid process (which took two years) mandated by the PPA’s terms of reference.

The project will raise more than P6.8 billion in revenues for the PPA over 25 years regardless of the economic situation and lower port rates by 10-15 percent. More than 1,000 workers of North Harbor operators will be absorbed, and an additional 5,000 jobs generated.

Harbour Centre chief executive Michael Romero said port modernization would help revitalize economic activities in Manila and spur growth across the country without the government spending a single centavo.

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BENEFITS: The entry of MPIC — the local infrastructure holding company of First Pacific Co. Ltd. of Hong Kong — is expected to stir competition and put pressure on the rates being charged by the older players International Container Terminal Services Inc. and Asian Terminals Inc.

North Harbor could also become the only port with direct access to the North Luzon Expressway whose operation is now in the hands of MPIC under a separate contract. New road links with the NLEx could be opened to Letre, Malabon, leading to the port.

Modernization will include dredging the filth and silt around the port, and replacing the old piers with structures similar to the modern ports of Rotterdam, Singapore and Hong Kong. Modern cranes and bigger container depots will be able to handle more containers.

Port officials have noted that the dilapidated state of the piers and the corroded structures below could no longer support heavy loads.

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FIRST STAGE: Phase I of the project will be carried out over six years. The winning bidder will complete during the first year the crane rail for two LO-LO (Load on-Load off) berths at Terminal 1 and the concrete paving of container yards.

After the crane rail for the LO-LO berths is completed, the operator will bring in two shore cranes and support equipment.

To be completed within three years of Phase 1 are such components as reclamation, construction of a passenger terminal, building of more LO-LO berths and RO-RO (Roll on-Roll off) berths, and the development of a P1-billion Information Technology system to streamline operations.

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PPA ROLE INTACT: The three years of Phase II will see the rise of Terminals 2 and 3 and the second passenger terminal.

Contrary to reports, the consortium will not be given a three-year grace period just to enable it to collect port dues, tariff and charges. As winning bidder, it will complete during the first three years of the contract a substantial amount of work.

The government will retain its sovereign power to levy tariff. In the 25-year contract period, the PPA/government will exercise its sovereign power and authority to levy port charges, such as usage fees and wharfage. –Federico D. Pascual Jr. (The Philippine Star)