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Poor infra, logistics hurt businesses - DTI

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Low investment in the country’s infrastructure is one of the reasons why the Philippines performs poorly in the world logistics performance index (LPI). But the good news is the country is slowly recovering.

In a meeting December 6 with local shipping and trucking company representatives, Department of Trade and Industry (DTI) Competitiveness Bureau head Jonathan Cabaltera said for the past 3 years, there is a downtrend in the country’s LPI, which in effect means that businesses would have difficulty particularly in efficiently transporting goods to and from their destinations.

Out of 10 countries in the ASEAN, the Philippines ranks 8th in terms of infrastructure development. In the past three or four years, infrastructure spending here has a Php209-Billion deficit as against the international benchmark of at least 5% of the gross domestic product (GDP).

Yet, President Duterte has been aggressive in infrastructure development, and the Philippines has been consistently closing the gap. Cabaltera said that this very well might be the “golden age of Philippine infrastructure”, as the government is targeting Php8.4-Trillion spending by 2022.

Other challenges in line with the low LPI include high logistical costs, or the high freight rates of shipping and trucking, as well as the bureaucracy which makes it time consuming and difficult for businesses to get permits for logistics.

The DTI presented this report to be able to gather local insights, particularly from the logistics stakeholders on how to improve the country’s standing in the index, and eventually to make doing business easier in the country. (By Dominic I. Sanchez/PIA9-Zamboanga City)




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