The shipbuilding and ship repair industry has always been considered a major maritime sector of Maritime Philippines. Rightly so with the hundreds of islands which need to be linked in this archipelago and maritime transport remains the most practical mode of moving people and goods in terms of cost and volume. Ships primarily carry the country’s foreign trade.

Over the years, government through the Maritime Industry Authority (MARINA) endeavours to promote the Philippines as a shipbuilding and repair country. Blueprints laying out programmes to develop the industry were generated; repeatedly these reflect the same set of incentives and reforms aimed at engendering stakeholders’ and investors’ interest. Policy, legislative and institutional reforms are neatly articulated everytime; yet, it seems the Philippines has to do a lot more than having a well prepared plan.

I have always thought that having a shipbuilding and ship repair industry is necessary for an archipelago. This is built on the notion that having shipyards will mean generating government revenue and foreign exchange as well as in creating local employment. This perception was strengthened by the country’s hosting the big shipyard locators from Japan, Singapore and South Korea which are building huge ships for foreign clients. I was so convinced the Philippines could become a successful shipbuilding country able to compete in the global market that I suggested to my niece who will complete her senior high school in 2019 to go into naval architecture. She took the STEM track and she expressed her interest in taking an engineering degree.

As one who advocates for wider women participation in the maritime sector, I tried to convince her by saying it is ships that she will produce instead of the usual vertical (buildings and skyscrapers) and horizontal (roads) structures. I was surprised on the enthusiasm of such a young budding engineer. Then came the ensuing questions which caught me off-guard and made me re-think what I always believed about the shipbuilding and ship repair industry.

Her first question was for whom are we to build the ships, for the local shipowners or for foreign clients? She also quickly retorted, it must be for domestic shipping because we have many islands and therefore there must be a huge local market. What she did not know is that most of the ships trading in domestic waters are imported second hand which are re-converted/re-configured. Well, I suppose the wooden-hulled vessels are at least proudly “products of the Philippines”.

 We have been crafting plans and programmes to encourage shipbuilders to invest in the country; but have we seriously examined who and where locally-built ships are most needed? Shipowners do not need the ships; they operate them, purportedly for public service but more practically they are there also to earn some returns on investment. The producers, mostly in the agriculture sector need the ships. They are the farmers and farm growers and fisherfolks. They who need to bring their cargo to the market/consumers need the ships. The passengers who need to go from island to island, from coast to coast need ships. Yet they hardly figure in planning for the shipbuilding sector. Oh, yes, there are the cargo consolidators and distributors but mostly speaking on behalf of their immediate trading and business concerns.Maritime policies and plans are formulated to primarily assist business, most often disregarding concerns of the general public including those who farm the lands. One of the agenda of the present leadership is that of stimulating rural development through a robust agriculture sector which could be realized through a reliable and cost-effective maritime transport system. These sectors must act as the advocates for locally-built ships which are custom-made according to their requirements, and not re-configured from out of second-hand ships originally built for other purposes.

The oft-cited reason on why shipowners prefer to import second-hand ships is the high-cost of buying a locally-built new-building because of the high tax rates levied on them compared to tax incentives extended to those who purchase vessels overseas and other incentives not otherwise enjoyed by those who buy “made in the Philippines” ships.

What then is the point? The push to grant incentives to shipbuilders are made by the shipbuilders, shipowners and MARINA. Why not change the scenario with the agriculture and rural development sector as advocates for locally-built ships. Who knows, they may just catch the attention of the President and Congress. And MARINA may start to re-orient its engagement with the Board of Investments, the Department of Trade and Industry and the Department of Finance with a call to support the farmers and fishermen for cheaper transport costs by providing incentives to local shipyards. It will probably be the same plans and programmes, the same incentives to be sought, but with additional advocates too!

As a final aside, I would like to ask: what is our vision for the shipbuilding industry? We need to be clear about it – do we want to be the number 1 shipbuilding country of the world? Or do we target filling up our local needs for ships? We need to know where we wish to go. As George Harrison, the famous Beatles’ member once quipped: “if you do not know where you are going, any road will bring you there”.

Credits to: Atty. Brenda V. Pimentel

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