News carried earlier this week that the Philippines is trying to position itself as one of the world’s top crew change hubs has been welcomed by many, but crew specialists have voiced concern at the hurdles that need ironing out in the Southeast Asian republic.
“It is my hope for the Philippines to become a major international hub for crew change,” transportation secretary Arthur Tugade said Monday while opening up a number of ports on the main island of Luzon for international crew changes.
Filipinos account for the largest share of seafarers in the world. Data from Windward (carried below) shows plenty more ships are calling at the country for the first time this month.
Once the world normalises, this current bonanza will come to an end
“By becoming a crew change capital of the world, we would not only prime up our seafaring and maritime industry. We also expect to boost our hospitality industry,” Philippine Ports Authority (PPA) general manager Jay Daniel Santiago said on Monday.
Welcoming the news, Kishore Rajvanshy, managing director of Hong Kong-based Fleet Management, told Splash: “We see this as a very positive move and hope the ground work related to visa issuance for both incoming and outgoing seafarers is managed seamlessly.”
Henrik Jensen, founder of crewing specialist Danica, warned however that despite the creation of a so-called green lane for seafarers in Manila last month, crew changes in the Philippine capital remain “very difficult”.
To be the crew change capital of the world is maybe a bit optimistic at present
Crew change requires a permission which needs to be applied for three days in advance, Jensen explained. If the arrival time of the vessel changes then a new application must be made and it again takes three days to get a new permission
Vessels need to be fully declared in and out of Manila by customs so it is not possible to do the crew change outside of the port limits. This typically adds around $8,000 to the operation.
The green lane means that joining crew must go directly from the airport to the vessel and leaving crew must depart by plane within four hours after stepping down from the vessel.
“The Philippines is better than other places but to be the crew change capital of the world is maybe a bit optimistic at present,” Jensen told Splash.
Carl Martin Faannessen, who works with crewing specialist Noatun Maritime in Manila, said there were three aspects to the Philippines wanting to position itself as a hub for crew changes: Political, tactical and practical.
Politically, the Philippines has been under pressure from the European Maritime Safety Agency (EMSA) and multiple shipowner associations to address several long-standing issues. While much progress has been made, much remains to be done if the aim is for the Philippines to establish itself as a consistent high-quality provider of crew.
Prior to Covid-19, many countries such as India, Myanmar and Vietnam had been stealing a march on the Philippines in crew numbers on merchant ships. As a result, the market share of the Philippines was stagnant or even declining. With all the restrictions in force as a result of Covid-19, many stakeholders in the Philippines see an opportunity to gain marketshare.
Tactically, several high-traffic trade lanes pass the Philippines. A deviation to ports in and around Manila is not an insurmountable obstacle. However, vessels tend not to do anything else but change crew as bunkers, provisioning and spares can all be had at much better prices in Singapore or Hong Kong.
“Ashore, it remains difficult to move crew within the Philippines. The writ of the central government is easily changed at local level, and there are areas imposing a 21-day quarantine on crew and others moving to their area,” Faannessen said. This means there is immense pressure on the crew-pool in and around Manila. One manning agency in Manila, for example, is currently looking to fill over 400 vacancies for tankers.
At sea, there has always been a limited number of crew-boats available, and the ones available are doing brisk business. As a consequence, prices have shot up and quotes are now being offered at $600 for the first nautical mile.
The shortage of crew boats was something also picked up by a spokesperson for port agent, Inchcape Shipping Services. The port of Manila is using tugs now to transport higher volumes of crew.
The Inchcape spokesperson also highlighted the severe traffic in the capital as a cause of delays for vessels.
Practically, there is a path to replace non-Filipino crew on paper in Manila. Non-Filipino off-signers will need a special permit from the Ministry of Foreign Affairs, and as of yesterday none had been issued. Onsigners will need a type of visa called a 9(g), which gives the right to work in the Philippines.
The other major issue the country faces regards flights. Qatar Airways has said this month it has the capacity to fly three times daily to destinations across the Philippines, but is awaiting approval from Manila to get the extra flight slots. Problematically for crew providers, Qatar Airlines requires passengers to present negative Covid-19 tests, something that takes two to three days to get in Manila.
KLM has been active in the ongoing crew change crisis with a number of flights linking the Philippine capital with The Netherlands.
Philippine Airlines is the only scheduled airline flying to Manila from four different continents. The national flag carrier is adding a second weekly frequency from London Heathrow starting in September.
“Beyond London, we are upping capacity across our network to support the marine industry and the movement of overseas Filipino workers, both land and sea based, who fill vital key worker roles across the world,” a spokesperson for the airline told Splash.
“During Covid-19, the Philippines can pull this off,” Noatun’s Faannessen said today, adding: “Once the world normalises, this current bonanza will come to an end as it will remain a commercially better option for owners and managers to concentrate their operations in a few key locations.”