Mindanao Development Authority Chairman Datu Abul Khayr Alonto points to the new Davao-General Santos-Bitung route that will be launched on April 30, this year during the business forum held at the SMX Convention Center in Lanang, Davao City on Friday, February 24. The route is seen to strengthen the bilateral trade relations between Indonesia and the Philippines. (Zea Io Ming C. Capistrano/davaotoday.com)
DAVAO CITY, Philippines — It will not be long before a shipping service will link Asian neighbors Indonesia and the Philippines.
The Davao-General Santos-Bitung/ASEAN Shipping Service route will be launched on April 30 this year.
Once the MV Super Shuttle Roro 14 sets sails the travel taking the route from Davao City to General Santos cities in the Philippines to Bitung City in Indonesia will only take 1.5 days.
The vessel is owned by the Asian Marine Transport Corporation. The cargo and roll-on/roll-off car carrier has a gross tonnage of 6,974 tons and a capacity of 100 TEUs (twenty-footer equivalent units).
Datu Abul Khayr Alonto, chairman of the Mindanao Development Authority said the route is considered by government as “one of the greatest highlights of the country’s chairmanship of the (Brunei-Indonesia-Malaysia-Philippines-East ASEAN Growth Area) and (Association of Southeast Asian Nation) Summit this year.”
“It can be recalled that President Duterte committed the establishment of this route during the ASEAN Business and Investment Summit in Laos last year,” said Alonto.
Indonesian Consul General Berlian Napitupulu said the new route will cut the travel time and travel cost between the two countries.
“Especially the eastern part of Asia. It’s already 300 miles by sea, it’s only 33 hours compared to three weeks of the existing sea connection,” he said.
Using the new shipping service will cut down shippers’ expenses from $2,200/TEU to only $700/TEU, and will speed up the travel from three to five weeks taking the Davao-Manila-Jakarta-Bitung route to only 1.5 days.
Napitupulu said the connection will boost direct trade and business to business cooperation. The sea connection, he said, is in line with the priority development of Indonesian President Jokowi Widodo.
Challenges
However, Napitupulu said that both countries are facing two challenges in realizing the plan.
“One of course is infrastructure. We have to make sure that our seaports, either in Davao, Gensan or in Bitung, should be ready,” he said.
Bitung has three seaports and it still needs to be determined which port to use for the new route, he said.
The second challenge is the load factor. “Passenger is seasonal, there is a time that you have traffic of passengers especially during holiday season. But what about the daily normal day?
“Cargo and commodities are needed by the people wherever they live. So we have to guarantee there will be continuous flows of load from both sides,” Napitupulu said.
He stressed the importance of the new route to the bilateral trade relations of Philippines and Indonesia. He also said that products from Philippines and Indonesia must be prioritized in the shipping service.
“The commodities that will be traded in this route originated from Philippines and Indonesia. Although transshipment is not out, but let us first focus and prioritize our capacity, our capability of productions from both countries before relying on others,” he said.
Opportunities for Mindanao
Alonto said the Bitung Port is already reclassified as an international gateway.
“This will open additional opportunities in Mindanao commodities to be traded once we operationalize the RORO shipping services that will be plying this route,” he said.
Alonto bared that this month the Autonomous Region of Muslim Mindanao sent a delegation to the 2017 BIMP-EAGA Strategic Planning Meeting in Jakarta, Indonesia as part of the plan to open “cross-border trade” between the ARMM and all BIMP-EAGA countries.
“This week, I also met with Brunei Minister of Foreign Affairs and Trade II Pehin Dato Lim Jock Seng to discuss broad issues of mutual interests to Mindanao and Brunei in the context of BIMP-EAGA,”Alonto said.
He said MinDA and the Philippine Economic Zone Authority also signed an agreement to promote the creation and development of regional economic zone initiatives in Mindanao.
He said they are also working on the establishment of the Mindanao Railway System. (davaotoday.com)
