SITUATIONER REPORT OVERSEAS SHIPPING SECTOR
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1 SITUATIONER REPORT OVERSEAS SHIPPING SECTOR A. PROFILE As a result of MARINA's initiative to protect the Philippine flag, by tightening the bareboat chartering policy through the issuance of MC 33-A, on 26 March 199, the number of accredited overseas shipping companies indicated a continuous downward trend. As shown in Figure 1 below in 21, there were 135 accredited shipping companies with paid-up capitalization of P2,13.98 Million compared to the 145 accredited with a capitalization of P2, in 2. A slight decrease of 6.9% in terms of number and 6.77% for capitalization was noted. Figure 1 Number of Accredited Overseas Shipping Companies Source: MARINA - OSO Similarly, there was an observed decrease in the number of Philippineregistered ships in 21 which totaled 22 as compared with the 2 figure of 242 or a noted decrease of 17%. Details are presented in Figure 2.
2 Figure 2 Number and Tonnage of Philippine-Registered Overseas Fleet, Number DWT (In Million) Source: MARINA - OSO total no. DWT In 21, 56% of the total number of the country s overseas fleet of 22 comprised mostly of bulk carriers followed by general cargo (13%), and other ships (31%), as shown in Figure 3 below. Figure 3 Philippine-Registered Overseas Fleet by Type of Service 21 General Cargo 13% Other Vessels 31% Bulk Carriers 56% Source: MARINA OSO B. PERFORMANCE
3 With regard to the sector s performance in relation to the Authority s mandate, the sector has undertaken significant moves to address various maritime issues and concerns, notable of which are the following: The policy allowing domestic ships to engage temporarily in the overseas trade through Special Permit provides opportunities for domestic ships to participate in the carriage of the country s exports and imports. While Figure 4 below shows the downtrend in the grant of special permits to Philippine-flagged ships to operate in international voyages, is primarily attributable to the permanent conversion to overseas trading. The recent issuance of MC 166 allowing the extension of liner-cargo operations of domestic ships to include international ports is expected to increase the participation of RP-flagged ships in the carriage of our international trade. Figure 4 Number of Special Permits Issued to Domestic Shipping Vessels to Temporarily Operate in the Overseas Trade Source: MARINA - OSO Revenues generated in 21 amounted to P1, Million including the dollar remittances from seafarers onboard Philippine overseas registered ships. The 21 data as shown in Figure 5 is broken down as follows: - P16.81 Million was derived from the 4.5% withholding tax involving overseas shipping companies for charter hire remittances of their ships. A slight increase of 6.38% from last year s P Million recorded figure is a result of the devaluation of the peso notwithstanding the decrease in the acquisition of ships.
4 - Foreign exchange remittance of Filipino Seafarers on board Philippine registered overseas fleet amounted to P1,626 Million as compared to P1,755 Million in 2 with a 7.35% decrease. - In line with MARINA s exercise of its regulatory and supervisory functions over the sector, fees and penalties collected in 21 amounted to P2.775 Million. Figure 5 Revenues Derived from Philippine-Registered Ships Collected by MARINA, BIR and CB (In Million Pesos) BIR Collections CB Remittances 1, ,755. 1,626. Revenues ( Fees) Source: MARINA OSO
5 There had been negotiations on review of proposed bilateral agreements with the Governments of France, Norway, Cyprus, Panama, Netherlands, Germany and Greece. Relevant provisions consistent with the foreseen growth brought about by globalization trends and developments were determined. A Bilateral Maritime Agreement between the Philippines and Norway was finalized and signed on 22 October 1999 and ratified by the President of the Philippines on 15 February 2. The draft agreement with Brunei had been finalized for possible signing within the year. In the light of more recent developments in global shipping, the Authority as the maritime administration, pursued the following activities to ensure the country s compliance with national and international rules, regulations and standards on safety and marine pollution prevention as set forth by maritime bodies like IMO. - Implemented the International Safety Management Code for the Safe Operation of Ships and for Pollution Prevention (ISM Code) making all overseas-going ships having a Safety Management Certificate and shipping companies with issued Document of Compliance. The Memorandum Circular approved for the Implementation of the ISM Code in consistent with the standards set by the 1995 STCW convention and improves the competency of our seafarers on board Philippine registered ships. - With the ratification of the International Convention for the Prevention of Pollution from Ships 1973 as modified by the Protocol of 1978 (MARPOL 73/78) on 15 September 21, a study was conducted on the mandatory pollution to cover all Philippine flag ships in accordance with the International Convention on Civil Liability and International Oil Pollution Compensation (IOPC) Fund A Project on International Convention for Prevention of Pollution from Ships (MARPOL 73/78) was proposed to the Government of Netherlands with specific concern on marine pollution in bays, harbors and other navigable waters within the Philippine archipelago.
6 - A workshop sponsored by Intermodal Task Force of the Transportation Working Group of APEC was held on 5-6 March 22 which focused on the development of skills needed to function effectively in the intermodal transportation industry. Current developments in the areas of best practices, infrastructure, and technology where introduced as innovations and challenges. C. PROSPECTS Philippine Ship Registry The promotion of the Philippines ship registry without necessarily making it a Flag of Convenience will maximize the economic opportunities that can be derived from the maritime sector. The grant of incentives to the overseas shipping sector through the rationalization of incentives under the Philippine Overseas Shipping Act, (RA 7471) by amending pertinent provision thereof; the amendment of Presidential Decree No on the Ship Mortgage Decree; review and rationalization of the bareboat chartering rules and regulations that will allow for economic gains from additional tonnage added to the country s national fleet. Bilateral Agreements Continuous forging of bilateral agreements between and among other shipping nations will ascertain not only the promotion of the country in the international trades, but the economic well-being of its Filipino seafarers as well. Maritime Security Pursuing efforts to preserve and ensure that maritime security in the country s ports and onboard Philippine-flagged ships is given priority attention. To this end the Authority endeavors to participate in the formulation of international/regional regulations on maritime security so as properly express the needs and capabilities of the Philippines as a maritime country. Actively participating in the formulation of a national action plan on preventing and suppressing acts of piracy and armed robbery against ships. The Philippines is also a part of a regional cooperation agreement on anti-piracy in Asia where several proposed initiatives and activities were identified to be pursued preferably by participating countries.
7 Sub-Regional Groupings The importance of sub-regional groupings such as the BIMP-EAGA, AFTA, APEC, among others, proves to be a viable move in enhancing the flow of services, capital and technical know-how and encouraging cooperation in various economic and technical aspects. With the country s continuous participation in these efforts, significant growth in trade and investments was thus far achieved. OSO_situationer_21 D39 (G 3 )
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