Cheaper option to modernize Davao Sasa Port sought

MANILA, Philippines - The Department of Transportation and Communications (DOTC) and the Public-Private Partnership (PPP) Center should come up with a cheaper option to modernize the Davao Sasa Port, Sen. Sergio Osmeña III said.

Osmena, chairman of the Senate public service committee, told a hearing on Tuesday, businessmen in Davao City are complaining about the cost of the project pegged at P19 billion.

“Why will you spend so much, what is the economic justification?” Osmeña asked Transportation and Communications Secretary Joseph Emilio Aguinaldo Abaya and PPP Center executive director Cosette Canilao during the hearing.

“I have 300,000 teus (twenty-foot equivalent unit of shipping containers) now and then I will build a P19-billion port and still handle 300,000 teus. How will the private sector recover its investments?” Osmeña asked.

The Davao Integrated Port and Stevedoring Services Corp. (DIPSSCOR), an operator at the Sasa port, said Sasa’s current capacity stands at 700,000 teus.

The yearly volume handled by DIPSSCOR, a subsidiary of the International Container Terminal, Inc., is only 300,000 teus. 

Osmeña said many businessmen are complaining about the alleged overpriced modernization program of Sasa Port. 

He said the project would mean an 80 percent increase in the rate per shipping container.

Alexander Valoria, president of the Anflocor Management and Investment Corp., said there is no need to convert Sasa Port to a container port.

Valoria said existing private ports such as Davao International Container Terminal, Terminal Facilities and Services Corp., Sumifru, Unifrutti, Dole/Pacinter and the planned Hijo International Port Services Inc. are enough to handle the container volume.

In a study conducted by Hamburg Port Consultants, container volume in the Davao region will grow at an average of 6.1 percent annually until 2040.

“The PPP Project is based on unrealistic projections. The growth assumptions are extremely unrealistic,” Valoria said.

Sasa port container volume declined by 134,504 teus or 33 percent and is expected to further decline this year, he said.

“This PPP project does not have the approval of the Davao City Council,” according to former Davao City councilor Danilo Dayanghirang.

Sec. 27 of the Local Government Code of the Philippines requires the prior approval of the city council for all government projects that falls within its jurisdiction.  

The PPP project has not also complied with pre-conditions required by the regional development council 11, which endorsed the project last year.

The project faces overwhelming opposition from various Davao business and consumer groups and concerned citizens since it will displace informal settlers whose livelihood depends on Sasa Port activities.

They also pointed out that there is no plan for break-bulk and bulk cargo, which is important for Davao City.