New PH-Indonesia sea route to boost ASEAN trade – JICA

A study undertaken by the world’s largest bilateral aid agency showed that the new Roll-On Roll-Off (Ro-Ro) shipping route between the Philippines and Indonesia will act as an important logistics infrastructure backbone to help boost the country’s trade with the Association of Southeast Asian Nations (ASEAN), stimulate local economy, and create additional jobs.

The shipping route covers Davao-General Santos-Bitung in Sulawesi, Indonesia.

The study is based on the Master Plan and Feasibility Study on the Establishment of an ASEAN Ro-Ro Shipping Network and Short Sea Shipping initiated by the Japan International Cooperation Agency (JICA) conducted four years before the launching of a ferry route between the two neighboring countries last week.

The study identified the commodities that can be exported via the said route as processed seafood, tuna, corn, Cavendish bananas, and dried fruits products.

President Rodrigo Duterte and Indonesian President Joko Widodo launched the new ferry route last April 30.

The M/V Super Shuttle RO-RO ferry service, operated by the Asian Marine Transport System, will be the first to set sail and will provide weekly services along the route.

Davao-General Santos-Bitung route, which is part of ASEAN’s subregional efforts to facilitate trade and investments, is among the priority RoRo routes identified by the JICA studies including Dumai, Indonesia-Malacca, Malaysia, and Belawan (Indonesia) Penang (Malaysia)-Phuket (Thailand) shipping routes.

According to JICA Chief Representative Susumu Ito, the ASEAN Ro-Ro presents opportunities for the Philippines to gain foothold in the ASEAN market in both trade and also tourism at the onset of regional economic integration.

Data from the Philippine Statistics Authority (PSA) for the first semester of 2016 showed ASEAN accounting for 21.7 percent of the country’s entire trade equivalent to $14.257 billion (roughly R2.5 billion).

On the other hand, government data showed that the Philippines’ trade with ASEAN from 2000 to 2011 had an average growth rate of 3.9 percent total trade vis-a-vis other ASEAN countries. Philippine intra-ASEAN trade also grew by 7.2 percent for the same period.