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Empty cargo ships wait out the economy in Philippine ports

In places like Subic Bay, the horizon is filled with vessels awaiting goods to transport. It's a windfall for the ports but an unwelcome cost for the shipping firms.

March 25, 2009|Paul Watson

On top of economic uncertainties, Philippine authorities have a lot more environmental, labor and other regulations to worry about than did Marcos, who could make things happen with the stroke of a pen.

Subic Bay requires captains to keep a full crew aboard ships, Hernandez said. Such "hot layups" ensure that hands are available to deal with typhoons or other disasters that could cause environmental damage in an area that wants to lure more tourists to its beaches and bars.


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Shipping companies normally prefer to lay off most of the crew until business improves. Paying a captain and an average crew of 17 to live on an empty vessel costs more than $30,000 a month, Estampador said.

Three other ports in the southern Philippines have allowed 25 ships to anchor with only skeleton crews, but insurance companies demand higher premiums because the region is fraught with Islamic militants and pirates.

Like many agents in the region, Estampador is getting calls from shipping companies desperate to find an affordable place to park their vessels. He is lobbying the government to open Refugio Pass, along the east coast of Negros Island in the central Philippines, to 30 or more cold layups.

Shipping companies also try slow-steaming, or stretching out the travel time of loaded vessels so freight backs up in warehouses and their ships have a better chance of taking on new cargo.

Another option is to send older vessels to yards to be taken apart for scrap. The Philippines is a small player in what is at times a dirty business -- rife with environmental and labor hazards -- dominated by India, China, Pakistan and Bangladesh.

The Philippines prefers to help keep vessels afloat because it supplies almost 20% of the more than 1.2 million seafarers on merchant ships worldwide, government figures show. Their wages are vital to the Philippine economy.

Protecting some of those Filipino workers is one of the reasons Subic Bay insists that laid-up vessels maintain full crews, Hernandez said. But the jobs saved may be drops in the ocean if Japanese shipping companies go ahead with planned layoffs. The firms have notified Philippine authorities that as many as 40,000 Filipino seamen may be sent home, Labor Secretary Marianito Roque told reporters last week.

But the numbers aren't as dire as they sound, said Nelson Ramirez, head of the United Filipino Seafarers union, which has 35,000 members.

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