AISL makes clarification

THE Association of International Shipping Lines (AISL) draws your attention to the news report (BusinessMirror June 19) entitled: “RP trading costs too high—WB.”

Our entire membership of major foreign lines plying the Philippine trade route, expresses deep concern over the manner the World Bank study was projected to readers of your paper. The way the first 10 paragraphs of the news report were sequenced, while apparently derived from World Bank figures, unfortunately implies that the cause of high-trading costs are none other than the foreign lines. This is misleading.

BusinessMirror said the “fee charged the exporter or importer by a foreign shipping company for transporting vans from Cebu to Manila already costs $500.” The distortion was summed up in the 10th paragraph when BusinessMirror stated that: “Except for the export wharfage, arrastre and loading fees, the World Bank said all these fees went to the foreign shipping liners.”

The $500 paid by the local shipper to the foreign line for transporting vans say, from Cebu to Manila, should be put in the right perspective. Foreign carriers, under the present policy on cabotage, are not allowed to convey goods from one port to another in the Philippines.

Given this constraint, foreign lines have to contract the services of domestic carriers for the local transshipment leg of the voyage. The former therefore pays for the freight and other incidental charges. Foreign lines then bill the shippers to recover the cost incurred. In short, the $500 paid by shippers to the foreign lines is simply in payment of a cost-recovery charge.

Under these circumstances, it is not correct to say that except for the export wharfage, arrastre and loading fees, all other fees mentioned in the report went to the foreign shipping liners. The sweeping phraseology in your report could invite a lot of negative reaction from the public, particularly those not knowledgeable on the intricacies of shipping.

Maximino T. Cruz

General Manager

Association of International Shipping Lines Inc.

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THE Association of International Shipping Lines (AISL) draws your attention to the news report (BusinessMirror June 19) entitled: “RP trading costs too high—WB.”