Definitely, the outlook for the Philippine shipping industry is bright. This, however, depends largely on how the Philippines takes advantage of its unique situation in shipping; notably as the leading crew provider to the world fleet.
Filipino seafarers account for about 20 percent of about 1.9 million seafarers worldwide and are the single biggest nationality in the global seafaring market. There are around 400,000 Filipino seafarers on board merchant ships worldwide at any given time, which other Ship Registries do not have.
The Philippines has also relaxed cabotage restrictions, allowing foreign ships to carry goods between domestic ports under Republic Act 10668 which granted foreign vessels the right to engage in limited cabotage under certain conditions. Only last year Congress also amended the old Public Service Law that finally allows 100 percent foreign ownership of companies engaged in domestic trade.
Add to these is House Bill 4336 or the Philippine Ship Registry System Act sponsored by Ilocos Norte Rep. Angelo Marcos-Barba which is laudable. The passage of this long overdue measure would certainly further enhance the bright prospects of the Philippine maritime industry.
The bill, if enacted, would help establish the Philippines as a leading maritime nation and a reputable Flag State by attracting international shipowners to register their ships in the Philippines which would create ancillary services and generate more employment, thus, contributing to the country's economic growth.
It would also ensure the exercise of our rights over Philippine-registered ships, affirm the Philippines' commitment to comply with international maritime conventions, and help achieve the IMO mission — the promotion of safe, secure, environmentally sound, efficient, and sustainable shipping.
Hence, the passage of the proposed Ship Registry System Act should be our initial step toward compliance with the IMO Member State Audit Scheme.
These are opportunities for our maritime industry to intensify its business potential and encourage foreign direct investments. Businesses such as ship management, shipbuilding, ship recycling, ship breaking, crewing management, and maritime education and training will definitely benefit from the enactment and effective implementation of this proposed law.
While we support HB 4336, we see some areas that can still be enhanced to make it more effective such as in enforcing maritime laws and in attracting foreign shipowners to register their ships as we have pointed out in our last column.
There is a need to revisit some of its provisions to check on some inconsistencies and address some points raised by maritime stakeholders. Issues such as having shipowner-friendly provisions like a permanent registration or at least a longer validity period of five years rather than the proposed 3 years, and steps to incentivize shipowners whenever a full-Filipino crew is utilized, should be considered.
Providing fiscal and non-fiscal incentives such as discounts or non-levy of duties on their ship repair and dry docking whenever a local ship repair facility is contracted.
Likewise, incentives similar to those granted by the Philippine Export Zone Authority to its locators i.e. non-resident foreign nationals may be employed in supervisory, technical or advisory positions, special non-immigrant visa with multiple entry privileges for non-resident foreign nationals such as investors, officers, and employees in supervisory, technical or advisory positions, and their spouses and unmarried children under 21 years old, are highly recommended.
These are just some of the measures that several stakeholders like the Philippine Association of Coastal and Inland Water Ferries proposed to maximize its full potential and ensure the effective implementation of this bill, once enacted.
These matters should be extensively discussed during the technical working group meetings called to review the provisions of HB 4336.
Once signed into law, this will significantly benefit our Filipino seafarers and shipping transportation in general. An efficient and satisfactory ship registry will boost Philippine influence in the evolving international commercial and regulatory environment for shipping, attract tonnage and strengthen the country's economy, helping realize growth and a buoyant future for our maritime industry.
