Groups and personalities opposed to the digital shift in port operations through a comprehensive scheme that the government will introduce are being misled and can’t see the forest for the trees.
The anti-automation group that includes high government officials wants the Trusted Operator Program-Container Registry and Monitoring System or TOP-CRMS suspended indefinitely, citing unsubstantiated claims of losses to stakeholders who have long been raking in hidden profits as a result of the inefficient port operations.
New Philippine Ports Authority estimates, gathered through simulations, showed savings on logistical expenses of up to 84 percent to importers, shippers, truckers, and Customs brokers with the TOP-CRMS in place.
Based on 2022 data on container traffic at the Port of Manila, the PPA indicated that P23 billion was paid in logistical fees for an average of P20,000 each for 1.1 million container vans that used both ports.
But once the operations are digitalized, the PPA said the expenses would be reduced to P1.1 billion or less than five percent of what is being paid now.
The TOP-CRMS tracks container vans in real-time and is expected to streamline all transactions at the ports.
Traders will generate bigger savings from unnecessary storage charges that do not pass through government checks thus resulting in a loss of revenues.
Empty container return costs were estimated at P7.3 billion last year or an average of P6,400 each.
With TOP-CRMS, empty container return costs would be reduced to P4 billion or an average of P3,520 per container inclusive of the first three days of yard storage.
The introduction of automated port operations will pare the costs traders incur from shippers by as much as P95 billion, based on new estimates by the Philippine Ports Authority.
All in, TOP-CRMS would cost traders only P29 billion in insurance premiums and container yard storage fees a year.
Based on 2022 data of 1.1 million container vans that passed through the two main ports of Manila, importers incurred a cost per 20-foot equivalent unit container box of P123,250.
Foreign shipping lines collected a total of P124.58 billion from container deposits, container yard storage, and trucking costs.
The savings to shippers, truckers, and Customs brokers would reach P95 billion through the use of technological innovation.
The amount constitutes the extra income that will be lost to shipping lines through automation, aside from the potential income that would be lost from exploiting the weak cargo monitoring system.
The technical smuggling of goods, based on industry estimates, costs the government P250 billion in taxes a year.
“They would not accept any logical explanation because the bottom line here is that this would result in a big cut in the earnings of businesses under the current system, which, on the other hand, is a burden to importers and shippers,” PPA general manager Jay Santiago put it bluntly.
The pushback is deplorable since it is based on protecting income that is generated through inefficiency at the ports.
Ease of doing business is the key to putting an order in the country’s gateways through digitalization.