Chiz tells DTI, PPA: Spike in arrastre fees to hurt economic recovery

Press Release
August 13, 2021

SORSOGON CITY – Sorsogon Gov. Chiz Escudero has called on concerned government agencies to look into the current fees and charges imposed on various cargo shipments which sharp increases amid a global health crisis could hurt efforts to help the country rebound from the pandemic-induced economic downturn.

The veteran legislator has learned that arrastre fees in most major ports under the Philippine Ports Authority (PPA) went up by as much as 200 percent, an increase that may ultimately impact the growth of the Philippines which recently has gone out of recession as the economy grew by 11.8 percent in second quarter this year.

“Arrastre fees in most major ports went up by 200 percent. For example, for every bag of cement, arrastre fees went up from P5 to P21 per bag,” the former senator posted on his Twitter account @saychiz.

“I hope the DTI (Department of Trade and Industry), the PPA and the DOTR (Department of Transportation) will look into this as it inordinately raises the cost of construction and doing business and DURING A PANDEMIC at that!” he added.

Arrastre is defined by the PPA as a person or entity that performs portside cargo handling operations, such as the receiving, handling, custody, security and delivery of cargo passing over piers, quays or wharves, transit sheds/warehouses and open storages within the jurisdictional area of responsibility of the authorized contractor or operator.

The PPA has continuously implemented, despite the ongoing COVID-19 pandemic, several memorandum circulars adjusting cargo tariff rates and handling fees in various ports nationwide under its jurisdiction such as the Manila North Harbor Port, Inc., Manila South Harbor, Inc. and the Manila International Container Terminal, despite industry-wide opposition of international shipping lines who are likewise battling the effects of the economic slowdown due to the pandemic.

In a position paper submitted by the Association of International Shipping Lines to PPA last year, industry leaders had warned that any increase in handling fees would not only hurt cargo handlers and operators, but more importantly small enterprises and consumers.

At the North Harbor alone, the PPA, through its Memorandum Circular 04-2017, has been implementing the 24-percent cargo handling rate increase since July 2019.