26 July 2012 Secretary Sonny Coloma

1. Transportation, Transport Packaging, and Supply Chain Infrastructure 26 July 2012 Secretary Sonny Coloma

2. I. OVERVIEW OF TRANSPORTATION, TRANSPORT PACKAGING & SUPPLY CHAIN INFRASTRUCTURE IN THE LAST DECADE STRONG REPUBLIC NAUTICAL HIGHWAY SYSTEM

3. A. Inter-Island Travel: The Road-Roll-on/Roll-Off (RO-RO) Terminal System Linking the Entire Country • Allows cargo to be driven directly on and off ships, eliminating the need for time-consuming and costly cargo-handling and port-side equipment • Facilities for RO-RO have been built or rehabilitated in 22 ports identified under the Strong Republic Nautical Highway (SRNH) • with 42 RO-RO ships operating in the identified SRNH routes run by 25 shipping operators as of the end of 2009

4. Since its implementation, RO-RO has had a major economic impact on the Philippine economy, especially in some of the lagging regions of the Visayas and Mindanao • By providing the market with a much simpler and cost effective way of moving goods, the RO-RO system has changed the structure and operations of the maritime industry • In agriculture, the RO-RO network has enhanced agricultural productivity by helping in reaching a broader market. • Easier access to larger markets has given farmers a stronger incentive to increase their productivity.

5. B. Growth in Domestic Airline Industry • Has increased tourism activities • Urged the institutional and bureaucratic reforms in civil aviation • Civil aviation subsector underwent a degree of reorganization with the enactment of RA 9497 on March 4, 2008 creating the Civil Aviation Authority of the Philippines (CAAP) • To become globally competitive and address safety issues, especially those raised by civil aviation stakeholders, the government is implementing the Communications Navigation Surveillance/Air Traffic Management (CNS/ATM) system in accordance with International Civil Aviation Organization (ICAO) standards

6. C. Inter-Island Fast Crafts and Long-Distance Vessels (Shipping Cargoes) • RA 9295 - “Act Promoting the Development of Philippine Domestic Shipping, Shipbuilding, Ship Repair and Ship Breaking, Ordaining Reforms in Government Policies towards Shipping in the Philippines” • enacted on 03 May 2004 • deregulated the domestic shipping industry by allowing domestic operators to set their own passenger or cargo rates, hence promoting investments in the industry. • Maritime safety measures have been pursued in domestic shipping in compliance with International Safety Management (ISM) and National Safety Management (NSM) codes and the Maritime Industry Authority (MARINA) Ship Safety Inspection System • Ship inspection has also been enhanced through the Japan International Cooperation Agency (JICA)-assisted Project on the Enhancement of Ship Inspection completed in 2005 • Compliance with international maritime security standards has been implemented through the adoption of the International Ship and Port Facility Security (ISPS) Code

7. D. Airports/ Ports • New Iloilo Airport was completed in June 2007 to serve Panay Island and its immediate environs. • New Bacolod (Silay) Airport for Negros Island destinations opened for operations on January 18, 2008. • The Caticlan Airport is currently being rehabilitated. • Kalibo Airport’s terminal building was initially expanded to cater to the increasing visitor traffic to Boracay Island and nearby destinations.

8. Facilities of the San Fernando Airport in La Union were upgraded to serve the Cordillera area • The first phase of improvements on the Busuanga (Coron) Airport in Palawan was substantially completed. • On the goal of developing Subic–Clark as an Asian logistics center, the Civil Aeronautics Board (CAB) approved and published the IRR of EO 253 expanding air services at Diosdado Macapagal International Airport (DMIA) and Subic Bay International Airport (SBIA) • These improvements resulted in increases in capacity entitlements, new routes, more access points, multiple airline designation, and airline cooperative arrangements.

9. II. BUILDING ON THE GAINS FROM LAST DECADE: PHILIPPINE DEVELOPMENT PLAN (PDP) 2011-2016 • Accelerating Infrastructure Development • The Plan’s infrastructure development program aims to contribute to inclusive growth and poverty reduction. • It will support the performance of the country’s economic sectors and ensure equitable access to infrastructure services, especially as these affect the people’s health, education, and housing. • Toward these ends, the government will accelerate the provision of safe, efficient, reliable, cost–effective, and sustainable infrastructure.

10. HIGHLIGHTS ON TRANSPORT PLAN (LONG-TERM VISION, GOALS, TARGETS, AND ON GOING PROJECTS) VISION / GOAL: A safe, secure, efficient, viable, competitive, dependable, integrated, environmentally sustainable, and people-oriented Philippine transportation system.

11. Strategic Plan and Focus: • Ensure an Integrated and Coordinated Transport Network • Adopting a comprehensive long term National Transport Policy (NTP) • Developing a strategic transport infrastructure and maintain/manage transport infrastructure assets • Developing an integrated multimodal logistics and transport system 2. Address the overlapping and conflicting functions of transport and other concerned agencies a. Separate the regulatory and operation functions of transport and other concerned agencies

12. 3. Ensure transport safety and security a. Comply with safety and security standards • To promote development of conflict-affected and highly impoverished areas a. Provide linkages to bring communities into the mainstream of progress and development

13. Statistical Indicators on Transport Infrastructure Developmentbased on the Philippine Development Plan Philippine Development Plan Indicators for Water Transport Infrastructure. Good Performance: Number of cargo through Ports under the Philippine Ports Authority showed a significant increase of 12 million metric tons in 2011. Poor Performance: Five out of the seven indicators reflect a decrease or slow country performance in achieving the Millennium Development Goals in Water Transport Infrastructure.

14. Philippine Development Plan Indicators for Land Transport Infrastructure. Good Performance: Percentage of permanent bridges along national arterial roads increased from 92 in 2010 to 97 in 2011. The target passenger occupancy of non-air-conditioned city buses in in Metro Manila has been reached in 2011. Poor Performance: Five out of nine indicators reflect a slow improvement in land transport infrastructure development.

15. Philippine Development Plan Indicators for Air Transport Infrastructure. Good Performance: There is a significant increase in international and domestic passenger traffic in MIA, NAIA, and airports under CAAP. Poor Performance: There has been a decrease in international and domestic cargo traffic.

16. Philippine Development Plan Indicators for Rail Transport Infrastructure. Poor Performance: The numbers show that there is a minimal increase in annual ridership of passengers and a decrease in the ration of revenue to operation and maintenance cost.

17. World Bank Logistics Performance Indicators Study • The Philippines was ranked 52nd out of the 155 nations as among the world’s best in trade logistics, according to 2011 World Bank’s Logistics Performance Indicators study. • The country was also ranked as among the top performers in the lower middle income category, which also includes India and Mexico. • The WB study said the high performance was due to strong cooperation between the public and private sectors, and comprehensive approach in developing services, infrastructure, and logistics.

18. PARALLEL IMPROVEMENTS PARALLEL GROWTH • ON TRANSPORT = ON TRANSPORT • PACKAGING INDUSTRY • CRUISE Program • Connecting Rural Intermodal Systems Efficiency (CRUISE) Program of the Development Bank of the Philippines • Aims to support investment and improve the country’s primary transport infrastructure and logistics facilities to provide affordable , reliable and safe mass transport systems; • Support the efficient movement of basic commodities, bring down the cost of goods and services; and • Introduce sustainable, storage handling and distribution technologies.

19. DBP has approved 14 projects totalling P1.4-billion under CRUISE • Projects ranging from roads, packaging, transport and distribution facilities to cold chain facilities. • The projects are located in Isabela, Nueva Ecija, Bataan, Batangas, Sorsogon, Cebu, Negros Oriental, Negros Occidental, Eastern Samar, Agusan del Norte, Agusan del Sur, and Surigao del Sur • By providing the market with a much simpler and cost effective way of moving goods, the RO-RO system has changed the structure and operations of the maritime industry • It also seeks to promote rural-urban integration and physical connectivity, promote decentralization and reduce urban congestion, and accelerate economic growth particularly in high potential growth sectors, and leverage limited public resources for infrastructure through public-private partnerships.

20. B. TRAMLINE SYSTEM • Tramline System in San Lorenzo Ruiz, CamarinesNorte by the Department of Agriculture. • For farmers to benefit from the tramline, DA has given instructions to earmark funds for the construction of farm-to-market roads from the tramline station to the nearest municipal road. People within the area will save on hauling and transport costs by as much as 60%.

21. C. INVESTMENT PROJECT • In May 2012, The Board of Investments (BOI) has approved the investment project of Philippine company Aviva Shipping Corporation that is seen to further boost the country’s transportation infrastructure investments in the region. • The P683.9 M Aviva shipping project that will be located in Surigao involves domestic shipping operations for landing craft transport (LCT) vessels such as transporting mineral products from mining companies operating in Surigao.

22. FILIPINO INGENUITY CAN HELP IMPROVE TRANSPORT PACKAGING INDUSTRY • Reduce export rejects as it aims to help increase the country’s export revenues and aggressively compete in the global packaging market • The Department of Science and Technology (DoST) has been bolstering its researches on transport packaging . • Improve the quality and marketability of selected agricultural products • JICA’s Continuing projects and DoST in transport packaging technology

23. IMPROVEMENT ON TRANSPORT- INFRASTRUCTURE SOFTWARE : Communications, Information, Internet/ Social Media • Tracking through computers and mobile phones • In the transport of goods, there are several consortiums providing for excellent services from point-to-point from Luzon to Mindanao, as well as to other parts of the globe.

24. ENCOURAGING PUBLIC-PRIVATE PARTNERSHIPS • Government shall tap the private sector for the financing, construction, operation, maintenance, and rehabilitation of major infrastructure in high-priority areas, such as transportation, power and water • Review related guidelines and policies to clarify ambiguous provisions and streamline the procedures and processes of project approval and implementation

25. On-going Transportation Infrastructure Programs of the Aquino Administration DEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS • announced that the government is allocating about P500 million to construct and upgrade existing berthing facilities in key ports in the country in line with the government’s thrust to provide reliable and responsive port services and sustain the development of the country’s port community. • Construction of additional cargo handling space in the port of Tabaco, Albay • Upgrading of the Iloilo Commercial Port Complex and Ormoc Port • Rehabilitation and construction of 7 ports worth nearly 94 million

26. DEPARTMENT OF TRADE AND INDUSTRY • Created the Shippers’ Bureau where it lists accredited freight forwarding companies in order to safeguard the shipping of cargoes from abroad to the Philippines DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS • As mentioned by President Aquino in his recent SONA speech (2012), 1,569 kilometers of roads has been repaired, and 2,275 kilometers more in 2012, and 7, 239 more by 2016 to further facilitate the smooth and transport of goods and passengers.

27. Other Government Infrastructure Projects Air Transport Infrastructure Projects: • Upgrading of airports to increase its capacity • Commissioning of 23 electromechanical systems necessary for the full operation of the NAIA Terminal 3 • Extension of the airport runways Land Transport Infrastructure Projects: • Development of Railway system and network roads • PNR is set to open in July the Manila-Naga-Legazpi Route which will make possible the operations of PNR’s express shipment carrier services that will transport heavy products and merchandises to and from different municipalities and provinces under Bicol express. • NLEX-SLEX Link which is a 4-lane elevated expressway that will connect NAIA terminals through the NAIA Expressway.

28. Transportation, Transport Packaging, and Supply Chain Infrastructure 26 July 2012 Secretary Sonny Coloma