Exciting prospects in Manila port plans
PRIVATIZATION: We hope lawyer Juan “Boy” Sta. Ana will not be inconvenienced by the heavy traffic of container vans on Bonifacio Drive when he heads over to his new office at the Philippine Ports Authority, because we know he will be a very busy man.
Sta. Ana, who used to be an executive of several firms under the F.F. Cruz group of companies, was named PPA general manager on July 19 in recognition of his experience in port management.
He was the agency’s assistant general manager for operations in the 1980s when “privatization” was just beginning to be a buzzword in ports and harbors all over the world.
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PORT ROWS: In his first policy statement, Sta. Ana said he was tasked to minimize government intervention and encourage private-sector participation in the port and shipping sectors, which are vital pillars of economic development.
He also identified the ports of Iloilo in the Visayas; Davao, Zamboanga and General Santos in Southern Mindanao; and Cagayan de Oro and Ozamiz in Northern Mindanao as the next candidates for privatization after the turnover of the North Harbor to the Harbour Centre-San Miguel Corp. consortium last April 12.
But much remains to be done before the privatization of the Port of Manila can be called a success. The PPA will have to help settle the compensation dispute with squatters in the area and stevedores affected by the North Harbor modernization plan.
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COMMENDABLE: The plan in itself is commendable as originally envisioned. Overall, it will mean more long-term regular jobs and substantial profits for the companies involved.
It will transform the 10-pier port to into a three-terminal harbor with wider and deeper waterways so cargo handling can improve from five to 28 containers per hour. It will also bring in computerization and modern cargo handling equipment.
With the entry of San Miguel into the picture, a grains handling terminal is now being planned and its subsidiary Petron wants to build an offshore oil tank farm to replace the hazardous Pandacan oil depot.
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‘ARMPIT’: If President Noynoy Aquino could motor through the North Harbor, he would understand why Manilans call the Port Area “the armpit of Manila” and what its modernization could bring about.
But on Sta. Ana falls the delicate task of dealing with the modernization’s objectors, some of whom have encouraged the poor’s need for instant gratification by “sponsoring” full-page broadsheet advertisements to block the plan.
We do not know all these supposed opponents, but former economic planning secretary Romulo Neri has identified the owner of the International Container Terminal Services Inc. as one of them.
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OBJECTIONS: During the Senate inquiry into the ZTE scandal, Neri supported the entry of Harbour Centre into the container-handling business, because that would cut shipping costs in the country that, at $1,300 per container, was among the highest in the world.
Neri said ICTSI owner Enrique “Ricky” Razon confronted him during a party in Forbes Park and quoted him as saying: “You will allow Harbour Centre to operate over my dead body.”
But that was three years ago and we do not know the circumstances that led to that utterance, assuming it is true.
We will even concede that the tycoon may have changed his attitude, because, aside from gaining a stake in the energy sector and a casino-hotel concession during the Arroyo administration, he also recently won a 25-year concession to operate the Port of Portland, Oregon.
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ICTSI MODEL: It is also hard to imagine why Razon would block the entry of other firms in the Port Area since he already has the very-profitable Manila International Container Port which is between the North Harbor and the South Harbor.
The MICP is operated by Asian Terminals Inc., the local partner of DP World, the third largest port operator in the world.
In fact, the new PPA head will certainly be aware that ICTSI is the best example of a successful port privatization. Razon was the first to get a 25-year contract to manage the Manila International Container Port in 1987 during the Cory administration.
Revenues from the Port of Manila have increased dramatically since ICTSI and ATI won their concessions.
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CHALLENGE: Can we not expect that the entry of the country’s largest conglomerate and largest oil company would bring more earnings that could be used to improve the North Harbor and its environs?
It is clear that the challenge for Sta. Ana will not only be port privatization since there are already many success stories, including that of Hong Kong and Singapore, that can be emulated.
The real challenge is how to apply President Noynoy Aquino’s dictum of “Juan dela Cruz-is-the-boss” even as he tries to strike a balance between the needs of a nation and the wants of a privileged few.
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FOOTNOTE: The venerable FF Cruz told us that Sta. Ana was not recommended by him as PPA general manager as “he is actually a loss to us, with an excellent service of 13 years.”
He said DOTC Secretary Ping de Jesus “asked for” Sta. Ana after he was impressed by Sta. Ana’s motion for reconsideration that lowered the acquisition price of land for the Batangas Port area from P5,300/sqm to just P475/sqm.
The higher price had been confirmed by the Court of Appeals and approved by the Supreme Court en banc, but Sta. Ana convinced the SC that the correct and equitable price should be only P475/sqm.
This reached the ears of De Jesus, who asked FF to allow Sta. Ana to head the PPA.