Iloilo and Iloilo Ferries Should Develop Zamboanga City as a Distribution Hub

I think one of the reasons for the success of Metro Cebu as a manufacturing and industrial center is first they did not simply rely on Metro Manila for its manufactured goods. Actually, they had the confidence that they can compete with the national manufacturing and industrial center and history proved them right. Metro Cebu can stand on its own and can compete with Metro Manila (and CALABARZON) in the supply and sales of manufactured goods in the south of the country and that means the Visayas and Mindanao in general.

Metro Cebu has some key advantages. One is that is the fact that the Visayan islands and Northern Mindanao (not the region but the northern part of Mindanao that borders Mindanao Sea from Surigao to Zamboanga del Norte) are practically their backyards. Second is Cebu has great shipping companies, their overnight ferries mainly, that connect to this wide area, taking in their goods for distribution at low rates and with the ease of transporting goods that the manufacturers simply need to bring their trucks to Cebu Port and everything will be automatic and only the destinations and consignees need to be worked out. And mind you Cebu does not have the traffic of Metro Manila nor its mulcting policemen, traffic aides and thugs or its thieving youth that prey on trucks while in traffic. Third maybe is this wide area is predominantly Cebuano-speaking like Cebu (never mind the crazy, unintellectual local language classification called “Binisaya”of Mindanao which is no different from Cebuano and is not recognized by any respectable language classification group outside the country).

Iloilo

Iloilo City (From http://www.iloilo.gov.ph)

I was wondering if Iloilo is developed as a manufacturing center if it can compete with Cebu should an Iloilo Ferries be established to help distribute its goods. My view is they will have a hard time competing with the premier port of entry of Northern Mindanao which is Cagayan de Oro. Iloilo might even have difficulty competing in Iligan and Ozamis because Iloilo is still farther and the cargo rates will probably be higher and I do not know if Iloilo Ferries will be willing to subsidize to achieve parity with the rates of the Cebu shipping companies. But then Iligan and Ozamis loyalty is still to Cebu because the links of the businessmen there are historically connected with Cebu and some are even just the expansion of Cebu businesses and businessmen. And if we will speak in a polite manner, it is generally known that Cebuanos and Ilonggos are not exactly the best of buddies.

Now, Dipolog and Dapitan is closer to Iloilo than the rest of Northern Mindanao. But then it is closer too to Cebu and the closest to Cebu actually like Surigao. And besides the ships to Dapitan have the intermediate port of Dumaguete to boost cargo volume and hence make shipping rate to Dapitan not that expensive for Dapitan and Dipolog as the two cities don’t have the volume of the likes of Ozamis which is a bigger and more important distribution center whose tentacles reach as far as Pagadian and Zamboanga Sibugay plus the western portion of Lanao del Norte. In Dipolog and Dapitan, Iloilo will still be underdog compared to Cebu.

But there is a great distribution center in Western Mindanao whose population is nearly as big as Cagayan de Oro and whose tentacles reach many provinces. This is Zamboanga City, the regional distribution center of the western part of Mindanao whose link with Cebu is not that strong compared to the likes of Dapitan, Ozamis, Iligan, Cagayan de Oro, Butuan and Surigao. It does not have the multiple nightly ships of the cities and ports I just mentioned. In fact it only has a weekly ferry from Cebu plus a few cargo ships. It is also not Cebuano-speaking, in the main, although Cebuano is also spoken there but not by the businessmen and traders.

Zamboanga City’s distribution network reaches Basilan, Sulu, Tawi-tawi, Zamboanga Sibugay and the western portion of Zamboanga del Norte and that is a wide area in itself and more than the size of one normal administrative or political region. Plus Zamboanga City itself is the size of a province and they have their own city districts. To illustrate its size, going east over 80 kilometers has to be negotiated before one reaches the Zamboanga Sibugay boundary.

Zamboanga_City_Skyline_2009

Zamboanga City (From Zamboanga.com)

In Zamboanga City I think Iloilo has a good chance versus Cebu in the distribution game should Iloilo go the way of Cebu in manufacturing (and they should I think) and be supported by Iloilo Ferries (if it materializes and it should, I think also). In distance Iloilo is nearer to Zamboanga than Cebu, its traders are not from Cebu although they base now their scions in Cebu to avoid kidnapping which is always a threat in Zamboanga City (and in Cebu they are able to enjoy their wealth unlike in Zamboanga). In short, Zamboanga City is not dominated by Cebu, tradewise.

Some might argue that Iloilo does not have a complete array of goods. But I would also argue neither is Cebu like for example Cebu has no cigarette manufacturing and that is an important grocery goods, saleswise. Cebu does not manufacture canned fish either. Actually, it is maybe only the National Capital Region plus its spillover to CALABARZON that has the complete line-up of goods (I am not so sure of that because we import goods we cannot produce).

Iloilo, I think, should aspire to be a great manufacturing center like Cebu and not rely on sugar like before. The time when sugar was still gold was long gone and it worked only anyway because of the US quota system where a fixed volume of sugar was purchased by the USA at support prices which was higher than the world market price. That was when there were few producers of sugar cane but now so many produce that crop already like Thailand and since their production and sugar mills are more modern their prices are lower. Sugar production is actually a losing enterprise locally and sugar prices have to be kept artificially high, nearly double the world market price so that sugar mills and haciendas can continue to produce sugar. I don’t think this system can go on as the Philippines is a member of the WTO (and we can be called for such practice) and soon the Filipinos will learn the true nature of our sugar prices and how expensive it is compared to the prevailing world market price.

Iloilo can have a wide natural market for manufactured goods. That includes Panay and Negros islands and maybe Western Mindanao, the area and not the political or administrative region. Plus Palawan and there is no harm in trying Masbate and the Bicol Region plus maybe Southern Mindanao which is already far from Cebu and Metro Manila, if Iloilo Ferries will dare support operations there and why not? General Santos City and South Cotabato have a lot of Ilonggos so much so that Ilonggo is practically the lengua franca there and not Cebuano. So an extension there might not be unnatural after all nor too far.

Western Visayas has a lot of elite families which can finance the industrialization of Iloilo and maybe Bacolod too like it was the local elite of Cebu which financed its industrialization. It is even easier to borrow capital now or tap the stock market or go the joint venture way as long as the project is sound and there is market that can be tapped. But for all its plans and ambitions there must be a dedicated shipping company willing to support the distribution of Iloilo goods and that is where Iloilo Ferries would have to come in.

There shouldn’t be just two strong manufacturing and industrial centers in the Philippines which are Manila and Cebu at the moment. If we want more development, more rural development and development all around there should be more strong manufaturing and industrial centers and Iloilo should be among those. I just hope Iloilo would have that vision and ambition like I hope Davao would also catch that and not just be known for Cavendish bananas, the new counterpart of sugar cane and which is gold now.

The ball is in your court, Iloilo and Iloilo Ferries.

Advertisements

Why Not Iloilo Ferries?

Many decades ago, I was wondering when I first heard the “Queen City of the South” monicker of Iloilo City because I thought it belonged to Cebu City. It was only later when I learned from reading that there was a time when Iloilo City can stand toe-to-toe with Cebu City and that it had a great past entering the 20th century. And that standing was propped up when sugar cane was still gold.

One of the requisites for a city to be great is not only manufacturing. It must also have great transportation links and this is one ace of Cebu City. Cebu has so many shipping companies with many routes and ports of call and so the goods of Cebu reach many islands and places. Conversely, goods needed by Cebu including food to feed its big populace are always available with reasonable prices. Like when I see packed vegetables from Bukidnon, I know many of it are headed to Cebu. I will also then see ads for Fighter Wine which is needed to fuel the muscles of the farmers and cargadores handling those vegetables.

There are probably many reasons why over the decades Cebu City outstripped Iloilo City. And one of those reasons is probably the difference in their shipping where Cebu City far outstrips Iloilo City. While Cebu has a dozen or so homegrown passenger shipping companies some of which are of national stature, Iloilo can barely list a few and most are small. Add to this the fact that Cebu City has perhaps two dozen or more cargo shipping companies and LCT operators while Iloilo City has only a few. These differences alone are more than reason for the disparity of the two cities now. An industry like shipping has a multiplier effect. And that is the reason why Cebu has Tayud, the Navotas counterpart of the shipyard row in the south. And Cebu has many mariners each of whom if deployed abroad contribute to the the economy of their hometowns.

There was a proposal for a petition to be sent to 2GO for the revival of Cebu Ferries. I respectfully disagree. There are so many Visayas and Visayas-Mindanao shipping companies already and some had shown great growth and aggressiveness in the past and among them are Cokaliong Shipping Lines, Lite Ferries, Roble Shipping and Medallion Transport. It will be hard to beat them now when they were not beaten when they were still not that strong. And factor in that the last three are also strong in cargo shipping and in transporting vehicles.

Maybe if 2GO and Negros Navigation Company (NENACO) want to expand to regional operations and maybe to bolster their bases Iloilo City and Bacolod City then they better just establish “Iloilo Ferries” rather than resurrecting Cebu Ferries. It will not be anthema to the company as they already have the equivalent of “Batangas Ferries”. This is what actually became of their Cebu Ferries when it left Visayan waters.

I think Iloilo Ferries can have five routes, to wit (this is a circular listing):

Iloilo-Romblon-Batangas route

Iloilo-Puerto Princesa route

Iloilo-Bacolod-Zamboanga route with a possible extension to General Santos City

Iloilo-Bacolod-Dipolog-Cagayan de Oro route

Iloilo-Cebu route

An Iloilo hub should be able to handle transshipment to other routes like goods from Zamboanga should be transferred to a Batangas or Cebu ship if the cargo is intended for that.

Anent the third route, an Iloilo-Zamboanga ship is needed because that connection has been lost when for a century it has been existing. When that was lost the passengers have to take the uncomfortable bus which has double the transit time.

Regarding the last, why should Trans-Asia Shipping Lines and Cokaliong Shipping Lines have all the fun? That is also the reason for the second route. Why default it to Montenegro Shipping Lines and Milagrosa Shipping?

The fourth route should be able to load vehicles at reasonable rates to better fill up the ship and compete with the Dapitan-Dumaguete ferry.

Regarding the choice of ships, I suggest to just invest in 80 to 100 meter ferries just like what Trans-Asia Shipping Lines and Cokaliong Shipping Lines use. If the route is potentially weak there is no dishonor in settling for 60 to 70 meter ferries like what Aleson Shipping uses for Jolo, Bongao and Sandakan. And that is what might be needed for the Iloilo-Puerto Princesa route.

If there is a shipping line with an Iloilo hub and also serving Bacolod then products of Western Visayas (I am using the old regional grouping) will be pushed and promoted and at the same time products from other regions needed by Western Visayas will also be made available and probably at cheaper prices. Like I know how cheap some products are in Zamboanga and these are not only barter goods. George & Peter Lines is not bashful taking in canned sardines, dried fish and even ginamos for this help fill up their ship and those are really cheap and Zamboanga and the city hosts some 7 canneries.

Dipolog (not Dapitan port) doesn’t have a regular ship link to Manila. With the fourth route ship passengers can be transferred in Iloilo if they are not clients of the budget plane. That is also true for Zamboanga ship passengers to Manila which has only one liner per week.

Since Negros Navigation is Western Visayan then it is their duty to develop Western Visayan shipping. There is probably no need to take cudgels anymore for Cebu Ferries as 2GO is no longer a Central Visayan shipping company. It is Iloilo City, Bacolod City and Western Visayas that need more support now.

Now, isn’t “Iloilo Ferries” a great name? If there was a Cebu Ferries and a “Batangas Ferries”, how can that name not be possible? And shouldn’t Negros Navigation honor Iloilo too?