DAVAO CITY, Philippines. "In efforts to reduce logistics costs and promote the competitiveness of the country's export sector, an Executive Order (EO) was issued by Malacanan Palace early this month, expanding the existing Road-Roll-on/Roll-off (Ro-Ro) service to include container Chassis Ro-Ro (Cha-Ro).

Released as EO No. 204, it amended EO No. 170 which was created to integrate the road network with nautical routes through the road Roll-On/Roll-Off Terminal System (RRTS). The amendment expands the Ro-Ro definition to include Cha-Ro service and lifts the restriction of the Ro-Ro to “self-driven” rolling cargoes.

"We welcome this development and consider this as a huge feat among Mindanao's business players who have been seeking for this amendment," said Secretary Luwalhati Antonino, chair of the Mindanao Development Authority (MinDA).

She added that MinDA actively pushed for the amendment of EO 170, as it was seen to reduce cargo handling cost by as much as 78 percent and strengthen connectivity within the Brunei Darussalam Indonesia Malaysia the Philippines East ASEAN Growth Area (BIMP-EAGA) sub-regional economic cooperation.

"Now that Cha-Ro is enjoying similar incentives with the regular Ro-Ro, we can expect the transport costs to be further cut down and for trading activities to increase in Mindanao and its counterparts in the BIMP-EAGA sub-region," said Antonino.

The Cha-Ro is a mode of Ro-Ro shipping where the container mounted on a chassis is loaded on and off the cargo belly of Ro-Ro ships by a prime mover or a tractor. Unlike the regular Ro-Ro mode, however, the container-mounted chassis is disengaged from the prime mover, transported by the Ro-Ro ship, and will be later picked up by another prime mover at its port of destination.

"Cha-Ro eliminated the need for cargo handling as the prime mover does half of the work, while the other half is done by shipping lines," explained Antonino while adding “this means Cha-Ro services will no longer have to pay cargo handling and wharfage fees.

With Cha-Ro cargoes reclassified as Ro-Ro cargoes, Cha-Ro operators for instance will only pay P516, as opposed to P1,161 per Twenty-foot Equivalent Unit (TEU) of container for a Cagayan de Oro to Manila shipment.

We strongly advocated for this amendment especially that Char-Ro is one of the widely adopted shipping services among the major ports in Mindanao, she added.

In 2014 alone, the total volume of Cha-Ro cargoes recorded in the port of Zamboanga, Cagayan de Oro, Nasipit, Davao, and General Santos amounted to 3.74 million metric tons, which is equivalent to 88 percent of the total cargo of the said Mindanao ports.

The inclusion of Cha-Ro as Ro-Ro service also supports the ASEAN Masterplan on Connectivity and promotes the development objectives of Mindanao as it will maximize the economic impact of maritime transport in the country and our connectivity with the neighboring economies, said Antonino.

Cha-Ro services is seen to address the left-hand, right-hand drive issue among ASEAN countries since prime movers from either side of the route would be used in extracting and moving the container-mounted chassis from the Ro-Ro ships.

It also complements the country's initiative to establish an ASEAN Ro-Ro shipping network as one of the key strategies to enhance physical connectivity in the nation, especially that ASEAN Ro-Ro operations primarily use Cha-Ro services, she said. #

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