Truck ban hurt growth in Q2

The Manila truck ban and port congestion hurt economic growth in the second quarter and the government should resolve the issue soon to attain its minimum growth target of 6.5 percent this year, a business group said Thursday.

The Philippine Chamber of Commerce Inc. said it would now be difficult for the economy to match the 7.2-percent expansion in 2013. “That was an election year. Spending was at its peak. The economy was very much alive,” PCCI president Alfredo Yao told reporters in an interview.

Yao said the issues of truck ban and port congestion would have its toll on the economy, which would be reflected in the second quarter GDP report. The economy grew 5.7 percent in the first quarter, the slowest in more than two years.

The PCCI said container vans had been piling up inside the ports. Yao, however, said the 6.5-growth target was still within reach, if the government would immediately act to resolve the issue.

“We can still catch up in the third and last quarters. We’re halfway through, but half a year is still plenty of time to ensure the healthy growth of our GDP,” he said.

Economist Victor Abola said the truck ban in Manila was one of the biggest challenges hindering growth this year. “This brought higher freight cost and higher spoilage on the part of perishable goods,” Abola, a professor at the University of Asia and the Pacific, said during the mid-year economic briefing of First Metro Investment Corp. in Makati City.

Manila in February imposed an expanded ban on trucks and other vehicles with gross weight above 4,500 kilograms from 5 a.m. to 9 p.m., except Saturday and Sunday. The ban exempts trucks carrying perishable goods and petroleum products, as well as vehicles used for government projects.

Abola said the truck ban had worsened traffic in other cities, which caused disruption in the logistics chain. “You can see trucks line up at Macapagal Ave. instead of going to their destinations,” he said.

He said this also cost a lot of business opportunities for exporters. “Exporters and producers are hurting because of this move. This could also result in accumulation of cargo ships in Manila Bay, meaning higher trade cost and spoilage in terms of perishable products,” Abola said. –Othel V. Campos, Manila Standard Today