Logistics investments rising in PH

June 21, 2024

  • The Philippines is experiencing a wave of logistics investments, particularly in port infrastructure, according to a recent brief by logistics and supply chain research provider Transport Intelligence
  • Recent investments include ICTSI’s new container terminal in Southern Luzon, India-based Adani Group eyeing a port in Bataan, and the Department of Agriculture’s plan to upgrade over a dozen regional and sub-regional seaports into deep-water facilities
  • The Philippines also has considerable potential for exploiting the shift in production activities away from China, Ti said

The Philippines is experiencing a wave of logistics investments, particularly in port infrastructure, according to a recent brief by logistics and supply chain research provider Transport Intelligence (Ti).

An example of recent investments is International Container Terminal Services, Inc.’s (ICTSI) new international container terminal in Bauan, Batangas, Ti chief analyst Thomas Cullen said.

ICTSI last May announced it is investing $800 million to build the southern Luzon project expected to be the second largest terminal in the country after the port operator’s flagship, Manila International Container Terminal.

ICTSI said it will begin construction in the first quarter of 2025 with the first berth scheduled for completion by the end of 2027. Upon completion, the terminal will feature up to 900 meters of quay and at least eight ship-to-shore gantry cranes and an estimated capacity of over two million twenty-foot equivalent units per annum.

Ti also said there are “rumors that the Indian port company Adani Group is seeking to build a terminal in Bataan, although there seems to be confusion over how realistic these plans are.”

According to a statement by the Presidential Communications Office, the Adani Group’s Adani Ports and Special Economic Zone Limited is eyeing to develop a port in Bataan. The India-based group is also planning to invest in ports, airports, power, and defense.

The Philippine government, meanwhile, also announced a program of port expansion for agricultural products, designed to support food imports for its growing population.

The Department of Agriculture (DA) last April said the Philippine Fisheries Development Authority will need P30.1 billion to upgrade over a dozen regional and sub-regional seaports into deep- water facilities. The four-year program is part of DA’s broader vision of transforming these facilities into agri-logistics hubs across the archipelago.

From the 2024 budget of P6.04 billion this year, P4.2 billion will be for the development of seven regional ports— four fish ports in Davao, General Santos, Iloilo and Zamboanga, and the three deep water ports in Cebu, Palawan and Surigao City. The balance will be for sub-ports with deep water ports of three to five hectares.

The 11 sub-ports identified for development by PFDA are those in Jose Panganiban, Camarines Norte; Pagudpud, llocos Norte; Bongao, Tawi-Tawi; San Jose, Occidental Mindoro; Cataingan, Masbate; Infanta, Quezon; Pantao, Albay; Kalmansig, Sultan Kudarat; Bataan; Mati City, Davao Oriental; and Cadiz, Negros.

According to Ti’s Cullen, the Philippines also has considerable potential for exploiting the shift in production activities away from China.

“It has a large, if relatively unskilled, workforce and an existing electronics assembly sector of some importance. The opportunities for logistics investment are considerable,” Cullen said.

He noted that the logistics developments across Southeast Asia reflect both the growth in globally positioned assembly operations and the increase in domestic consumer demand.

Although the large port developments may grab the headlines, Cullen noted there has also been a steady expansion in road building in countries such as the Philippines and Indonesia. This, he said, is amplifying the opportunities for warehousing and contract logistics-related infrastructure.

Source: https://www.portcalls.com/logistics-investments-rising-in-ph/