THE Department of Trade and Industry (DTI) vowed to make it easier for the Philippine logistics sector to do business in the Philippines.
Among the initiatives of the Trade department is to streamline the accreditation process for the logistics sector.
At the Supply Chain Trilogy 2023 Forum, DTI Assistant Secretary Mary Jean T. Pacheco said a streamlining initiative of DTI has been endorsed to the Anti-Red Tape Authority (ARTA) for Phase 2.
In a presentation at the forum, Pacheco said the Trade department has so far accomplished Phase 1 on cold storage, customs brokerage, domestic shipping, freight forwarding, trucking and warehousing sectors.
In addition, the DTI inked a memorandum of agreement (MOA) with the Civil Aeronautics Board (CAB) of the Department of Transportation (DOTr).
In December 2022, the DTI reported that “In 2021, the Logistics Services Philippines [LSPH] Project Streamlining was carried out by DTI to identify regulatory constraints in the freight forwarding sector.”
Among the key findings, the DTI noted, are the “separate and redundant” accreditation requirements and processes for sea and air freight forwarders by DTI’s Fair Trade Enforcement Bureau (FTEB) and the Civil Aeronautics Board (CAB) of DOTr, which, it said are two agencies mandated to issue licenses to operate.
Pacheco gave an overview of the burden experienced by the logistics sector as result of the redundancies.
“For example because of this study, one of the recommendations of freight forwarders, they know that I’m a freight forwarder and I’m a sea freight forwarder, I have to apply for my permit with the DTI-[Fair Trade Enforcement Bureau] FTEB, but I’m also into air, so I have to file my accreditation with the Civil Aeronautics Board,” Pacheco noted.
With this, she said, the private sector prodded the government to streamline the accreditation because “it’s a bit methodical.”
Pacheco invited IT firms present at the forum that are inclined to provide services to the government: “We want to see an IT solution to this particular problem, to merge the process of two agencies of government.”
Pacheco cited a study which DTI conducted together with the logistics industry on the life of a freight forwarding business. The illustration showed 8 to 19 regulatory agencies play a role in the life of a freight forwarding business; 21 to 62 permits/licenses; 97 to 614 documentary requirements; 63 to 410 client steps.
Meanwhile, the fees range from P43,005.35 to P703,923.19. For processing time, the life of a freight forwarding business can span from 2 months, 1 day, 1 hour and 22 minutes to 9 years, 2 months, 1 week, 2 days, 4 hours and 34 minutes, Pacheco said.
“We realized…so we gave this to ARTA because it has the mandate to streamline permits. But government agencies like DTI, we can do this, we need to automate,” Pacheco said. Through the lens of the logistics sector, Gilbert Singson, the National Cold Chain Head for Logistics, lauded the 10 commitments of DTI which included the streamlining of accreditations.
“At the end of the day, it’s really a matter of consolidating all of these steps into just one system, one person, one corporate entity, that would do the transactions,” Singson noted.
Apart from streamlining accreditations, DTI and the Cold Chain industry agreed on the need to “synchronize” the logistics operations in the country. Pacheco said the DTI had acknowledged that the problem with logistics “is that we’re not synchronized.”
For instance, she noted the port and terminal operators operate 24/7. In contrast, she said, “With the banks, the shipping lines, the customs brokers, even the government, we’re not. We’re 8 to 5.”
The Trade official said the entire system should be like a “well-oiled machine,” adding that if technology can carry out this objective, the DTI should make it happen.
Singson agreed that the Philippine logistics sector is not synchronized: “We need to look at the cold storage warehouses, the ports and logistics providers, the whole ecosystem and stakeholders of our industry because we know and we have identified that we are very fragmented, even as I speak, in terms of our trucking and the supply chain trucking industry itself.”
He also said the country does not have “one association that can represent the whole group.”
“I guess it’s really a matter of defragmenting the supply chain and making sure that we collaborate together,” Singson noted.