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De
Hussein S. LIDASAN, Ph.D.
Professor
School of Urban & Regional Planning
University of the Philippines
EGM on Urban Freight in Bangkok
2010 March 28-31

OUTLINE OF PRESENTATION:
Concept of City Logistics and Initiatives
Characteristics of Intermodal Logistics
Network System in the Philippines
City Logistics, Issues and Initiatives in the
Philippines: Metro Manila
Comparative Assessment of City
Logistics Initiatives in Selected Cities
City Logistics in Maritime Subregional
Cooperation

City Logistics is defined as:

The process for totally optimizing logistics and
transport activities in urban areas while considering
transport environment, traffic congestion and energy
consumption within the framework of free market
economy
It therefore aims to:
Allow the private shippers and freight carriers to
reduce freight costs, and
Ensure that the public sector alleviates congestion
and environmental and energy problems

Actors
want
wantthe
theleast
leastpossible
possible
time
to
market
time to markettheir
their
goods
while
minimizing
goods while minimizing
storage
storagelevels
levels resulting
resulting
ininfrequent
deliveries
frequent deliveries

interested
interestedininthe
the
availability
of
goods
availability of goods
anywhere
anywhereanytime,
anytime,and
and
improved
quality
of
life
improved quality of life

Shippers

Consumer

Transport
Service
Providers

Government

aim
aimfor
forminimum
minimum
cost
while
cost while
optimizing
optimizingquality
qualityofof
their
theirservices
services

Regulates
Regulatesfreight
freight
environment,
balances
environment, balances
market
marketforces
forces&&plays
plays
aamajor
role
in
major role in
resolving
resolvingconflicts
conflicts
among
actors
among actors

Grouping of City Logistics Objectives

1
To contribute
towards economic
performance

Economic

Efficiency

To increase
productivity in
transport operation

2
To reduce environmental externalities

Environmental

Safety

To reduce number
and severity of
accidents

3
To supply and
manage adequate
public infra

Infrastructure

Urban structure

To contribute to
preferred urban
structure

Grouping of Policy Measures

related to City Logistics
Transport
Function
Node

1 Freight terminals

Off-street loading and 3

parking facilities

2 Road construction

On-street loading and

parking bays

(Distribution centers)

Link

Cooperative delivery

Operation

Market

Information
Function

Road traffic info

system

Parking guidance info

Vehicle tracking
system
Vehicle routing system

Low emission vehicles,

Electric vehicles, etc.

Mode

Control

Goods Handling
Function

Truck ban, size/weight

restrictions, allocation of
truck routes/lanes, etc.

Loading and parking

time limits

Road pricing
6

Parking charges

Building ordinances

Cargo info system

Public and Private sector Policy

measures
Policy measures
Public
Public

Private
Private

Policy
Policymeasures
measuresthat
that
compel
private
sector
compel private sectortoto
change
changetheir
theiractions
actionstoto
become
becomemore
moreefficient
efficient

Measures
Measuresimplemented
implementedby
by
private
companies
to
private companies to
achieve
achieveefficiency
efficiency
(company-initiated)
(company-initiated)

Infrastructure
Infrastructuredevt,
devt,
Distribution
Distributioncenters/
centers/
Truck
Truckterminals,
terminals,
Licensing
Licensingand
and
regulations,
regulations,
Traffic
Trafficmanagement,
management,
Land
Landuse
usezoning,
zoning,etc.
etc.

Cooperative
Cooperativedelivery,
delivery,
Off-peak
Off-peakdeliveries,
deliveries,
Use
Useofoffuel
fuelefficient
efficient
trucks,
Vehicle
trucks, Vehicle
scheduling/routing
scheduling/routing
systems,
systems,Material
Material
handling
handlingsystems,
systems,etc.
etc.

Logistics policies by the governments

Infrastructure provision
Physical/
Transport

Land use

Information

Regulations
Regulations

Pricing

Digital map, GPS

Zoning for
logistics
activities

Property tax

Truck route
control, vehicle
and time
restriction

Road pricing

Networks

Ring roads,
freight networks

ETC, Road traffic

info system

Terminals

Distribution
centers

Berth guidance
system

Parking

OnOn-street
parking spaces

Parking
guidance info
system

Compulsory
parking spaces,
Parking time

Vehicles/
Containers

Electric vehicles,
Low emission
vehicles

Fleet mgmt
system, Vehicle
and cargo
matching

Emission control,
load factor
control

Cargoes

Standardization

Economic measures

Cargo tracking,
order entry
systems

Standards for
intermodal
terminals

Standardized
containers,
electronic tags

Subsidies

Subsidies for
cooperative
facilities
Parking charge
differentiation

Subsidies for
offoff-street
parking spaces

Vehicle tax, fuel

tax,
environmental
tax

Subsidies for
low emission
vehicles
Subsidies for
cooperative
delivery

f
o
s
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i
t
s
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c
a
r
a
Ch
l
a
d
o
m
r
e
t
In
k
r
o
w
t
e
N
s
c
i
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s
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Lo
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h
t
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S
s
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i
p
p
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i
Ph

Being an archipelagic country, the

Philippines intermodal logistics system is
anchored on its maritime transport
system, supported by:

A road network linking the ports to

production areas, markets and logistics
terminals
An air transport system with strategic
regional and local airports
An information-based system for
documentation (CIQS)
An intermodal transport system utilizing
Ro-ro network

(1) Areas for International Gateway

(2) Domestic Maritime Trunk Route

Maritime Trunk
Routes

(3) Land/Inter-modal Trunk Route

Phil ippi
ne A ir po
rt N et wo
rk

Ph i
lipp
ine

Na
ti on
al
Roa
dN
etw
o rk

Ph
(N ilipp
au
tic in e R
al
o
Hi - ro
gh
S
wa y s
y s te m

Grains Highway

For rice and corn transport

Mindanao accounts for 70% of

total corn production and 30%
of total rice production

Incorporates bulk processing

and handling centers, trucking
and terminal facilities with grain
silos, bulk grain handling and
bulk carriers

Cold Chain

Provision of improved cold

storage logistics for
perishable items like fruits
and vegetables

Aggregating and processing

centers
Reefer transport (equipment
and vehicles)
Grains Terminal in Bukidnon

Corn Processing Facility in Mindanao

Current issues

Lack of trip schedules at

some Ro-Ro connections

Increased waiting time of

passengers
Risk of missing scheduled
trips

Limited capacities at new

Ro-Ro routes and terminals

Arterial roads with average

total width of 6-6.5 meters
(both directions)
Increased side frictions (i.e.
presence of developments
at road sides)
Lack of berths at terminals

Trip frequency at major Ro-Ro connections

Origin
Batangas
Calapan
Roxas
Caticlan
Iloilo
Bacolod
Dumaguete
Dapitan
Matnog
Allen

Destination
Calapan
Batangas
Caticlan
Roxas
Bacolod
Iloilo
Dapitan
Dumaguete
Allen
Matnog

Trips/week
235
224
17
14
22
24
10
6
245
217

Ph
ilip
pi
ne
Re
gi
on
al

De
ve
lo
pm
en
tF
or
m
at i
on

Comparative Logistics Costs in the

Philippines
Item
Power
Logistics
Telecommunications

Cost
10-25% of costs
25-30% of costs
5% of cost

Source: Global Competitiveness Ranking (World Bank, 2006-07)

Activity
% of Wholesale Price
Post Harvest Services
3.1 5.4 %
Non-Port Handling
3.5 10 %
Port Services
2.6 5.4 %
Shipping
8.0 12 %
Trucking
7.0% - 11%
Total Transport Cost and Logistics
24.2 43.8%
Cost
Source: Cash Crop Distribution Systems in the Philippines (JBIC, 2002)

Total number of days to process a container

(Export and Import)
Export
Documents
preparation
Customs clearance
Ports and terminal
handling
Inland transportation
and handling
Total
Import
Documents
preparation
Customs clearance
Ports and terminal
handling
Inland transportation
and handling
Total

Duration
(days)

Duration
(days)

Duration
(days)

Duration
(days)

Duration
(days)

9
2

14
2

8
1

10
2

1
1

2
16
Duration
(days)

3
21
Duration
(days)

2
14
Duration
(days)

3
18
Duration
(days)

2
5
Duration
(days)

8
3

15
4

8
2

9
1

1
1

1
16

2
27

1
13

2
14

0
3

Source: World Bank Doing Business (2009)

Export

Export

Import

US Dollar

200
150
100
50
Singapore

Malaysia

Thailand

250

Import

Export

Import

Singapore

Export

Ports and Terminal Handling Fee per Container

Malaysia

900
800
700
600
500
400
300
200
100
0

Indonesia

Philippines

Singapore

Malaysia

Thailand

Indonesia

Customs Clearance Fee per Container

US Dollar

200
150
100
50

Inland Transportation and Handling Fee per

container

Source: World Bank Doing Business (2009)

Thailand

Indonesia

Philippines

Singapore

Malaysia

Thailand

Indonesia

Philippines

US Dollar

300

Import

250

Philippines

US Dollar

200
180
160
140
120
100
80
60
40
20
0

Total Cost to Import/Export per

container

,
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&
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Logis

A. Key Issues
Issues

Substance

Actions to be Taken

Philippines an archipelago * Linkage of the major islands has to* Develop efficient intermodal system
connecting major islands w/
be established
(consists of group of
islands)
* Completion and strengthening of the integrated nodal points
* Develop and maintain countrys
National Transportation System
arterial road system
Storage and movement of
*
Lack
of
farm
to
market
roads
raw materials and
* Develop farm-to-market roads
agricultural products from
* Lack of areas to market products
* Establish local market areas or
sources to markets
* Perishable goods (especially from
transfer points for agri products
agricultural areas) need to be
Air and Maritime Safety
* Encourage establishment of
maintained prior to delivery
delivery centers
*
Country
has
experienced
aviation
Lack of efficient
* Review air and maritime safety
and maritime disasters that
communications and
guidelines
resulted to loss of lives and
information systems at
* Enforce safety rules & regulations
economic loses
national level
* A number of local cities and areas * Continuously maintain and check
Linkage among
planes and vessels
does not have efficient
communications
communications and info systems * Completion of municipal telephone
companies
* Telecommunications companies are system
not yet fully linked or integrated
* Urge companies to hurry up with
Traffic congestion in major
their integration
* Longer travel time
cities and regions,
especially Metro Manila,
* Delay in distribution & movement of * Complete transport and road
Cebu and Davao
network systems
goods and people
* Develop mass transit systems and
implement TDM measures

B. Weak Points

Areas of Concern

Gaps

1. Implementation of Plan or * Lack of public investment on

infrastructure development
Project
2. Coordination among
government agencies in
planning and
implementation

* Too many agencies performing

the same planning and
implementation tasks

Mitigating Measures
* Encourage private sector participation
through PFI
* Initiate integrated planning and
coordination among agencies
* Initiate capability building in the fields of
logistics, IT &related fields

* Lack of persons specialized in

logistics and related fields
* Develop new courses &academic
*
No
formal
education
in
logistics
3.Expertise in the fields of
programs leading to these fields
and
related
specialization
logistics, information
* Develop formal and non-formal training
systems and physical
* Lack of an efficient and standard
programs
distribution
operation systems at freight
stations or (container) terminals * Experience at MICT be duplicated in
other major ports, container term
4. Standardization and
especially at other major ports
normalization of operating
* Develop standardized information
* Lack of standard system for
systems and information
system for logistical purposes
logistics information system
systems
* So far only the Port of Manila has * Formulate master plan for devt of
integrated cont term at key ports
an integrated container terminal
5. Development of integrated
* Initiate studies through academic
container terminals at major
* Lack of studies related to
institutions and research centers
ports
logistics, physical distribution
and information systems
* Integrate existing database sys.
6. Research
* Lack of standardized database
* Develop database for logistics and
systems
information system studies
7. Database systems

s
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oM
Metr o

Philippine Intermodal
Objectives:

Logistics

Policy

Local Level
Focused on reducing traffic congestion, alleviating environmental and
social impacts and improving the economic and technical efficiency of the
transportation system
City Logistics Initiatives
National Level
Aimed at providing efficient intermodal transportation system
Global
Focused on how to improve the efficiency of moving people and freights,
reducing the impacts of transportation on the global environment and
providing a global competitive trading

Prioritized City Logistics

Policy Objectives in Metro
Manila:
1. Efficiency and Economic
Objectives
2. Safety and Environment
3. Infrastructure and Urban
Structure

Some City Logistics Initiatives in

Metro Manila:
Transport Demand Management (TDM)
Schemes
Traffic Volume Restraint Measures
Truck Ban at major urban thoroughfares

Application of ICT (e.g., ETC)

Land Use Controls
Terminal Development
Development of Economic and Industrial
Zones at Urban Fringes

Formal policy documents on ICT

Japan
Basic Guidelines on the Promotion of an
Advanced Info and Telecommunications
Society, Feb 1995

Malaysia
Digital Signature Act, 1997
Computer Crimes Act, 1997

Basic IT Law, Jan 2001

Communications and Multimedia Act, 1998

Law on Electronic Signatures and Certification

Services, April 2001

ITS Strategic Plan, 2000

IT Document Package Law, April 2001

E-Commerce Guideline, Mar 2002, etc.

Korea
Basic Law on E-Commerce, Feb 1999
Electronic Signature Act, Feb 1999
Consumer Protection in E-commerce,
Jan 2000
Standard Terms and Conditions on
E-commerce, Feb 2000, etc.

Philippines
E-commerce Law, June 2000

Thailand
Electronic Transactions Act, Dec 2001
National IT Policy Framework, Mar 2002
National ICT Master Plan, Sept 2002

Freight Transport Characteristics of

Metro Manila:
Primary Objective: Efficiency & Economy
Underlying Problem: Congestion
Prioritized Measures: Road Links, Terminals
Info System
Main Expected Effects: Costs, Reliability,
Capacity
Link: Road Network
Operation: Off-peak Deliveries
Regulations: Truck Restriction

Issues on Truck Ban in Metro Manila

z
z
z

The truck ban is the most commonly used

vehicle restraint in developing countries
Banning trucks is a very feasible form of
rationing scarce peak period road space
Government usually enforces truck restraints
so that public transit modes would not compete
for limited road space
Viable measure during construction periods
when road capacity is greatly reduced to
ensure better traffic movements
Truck restrictions can present harmful effects if
not fully understood

Metro Manila truck ban

         Caloocan (North)

       Valenzuela
Malabon
   
              Quezon City

        Caloocan(South)          

Marikina

  
              
                San Juan
 Manila

Truck Ban
1
(EDSA
only)

6 AM to 9 PM everyday except
Saturdays, Sundays and Holidays. No
cargo truck shall be allowed to travel or
pass along EDSA.

Truck Ban
2
(10 major
routes)

6 AM to 9 AM and 5 PM to 9 PM
everyday except Saturdays, Sundays
and Holidays. No cargo truck shall be
allowed to travel or pass along these
routes.

Definition
of Cargo
Truck

Cargo truck as used in the ordinance

refers to motor vehicles, whether
loaded or empty, having a gross
vehicle weight of 4,500 kgs or more,
principally intended for carrying cargo.

Violation
and
Penalty

Any person who violates the provisions

of this ordinance shall be punished by
a fine of not less than 500 pesos but
not more than 2000 pesos or by
imprisonment of not less than 7 days
but not more than 30 days or both, at
the discretion of the court.

               
                Mandaluyong
            
                           
                            Pasig
     Makati
                      
                        
    
           Pasay
                      
       
    
              
              Paranaque

Pateros

Taguig

Truck Ban Hours:

6 AM 9 PM
6 AM 9 AM; 5 PM 9 PM
Alternate route from Port Area to Outside
Alternate route from Outside to Port Area

Economic impacts of truck ban

1.

Changes in truck operating characteristics

z
shortened delivery schedules; reduced delivery hours
z
reduced quantity of products delivered during banned hours
z
increased travel time

2.

Reduced truck delivery frequency

z
decreased truck trip frequency per day

3.

Reduced production efficiency

z
decreased rate of production due to delays in delivery
schedules

4.

Increased transport costs

z
increased costs due to poor productivity are passed on to
consumers

Safety impacts of truck ban

z A Probit Study indicated that the
likelihood of accidents increases when
the truck driver:
operates a trailer-truck
has insufficient sleep
performs nighttime deliveries
has no complete knowledge of the
truck ban ordinance, and
violates truck ban rules
z Truck ban has significant impact on the
likelihood of accidents

e
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Preference
Preference survey
survey of
of experts
experts

Weights of objectives
Jakarta

KL

Objectives

Bangkok

Manila

Shan
ghai

Seoul

Osaka

Tokyo

Efficiency &
Economic

0.327
(2)

0.481
(1)

0.258
(2)

0.550
(1)

0.500
(1)

0.311
(2)

0.097
(3)

0.167
(2)

Safety &
Environment

0.413
(1)

0.405
(2)

0.637
(1)

0.240
(2)

0.250
(2)

0.493
(1)

0.570
(1)

0.667
(1)

Infra & Urban

structure

0.260
(3)

0.114
(3)

0.105
(3)

0.210
(3)

0.250
(2)

0.196
(3)

0.333
(2)

0.167
(2)

Numbers in parenthesis indicate rank order of importance.

z Developed cities: priority on safety and environmental objectives

z Developing cities: priority on economic and efficiency objectives
Bangkok & KL: priority on safety and environmental objectives due to
current severity of pollution and high accident rates
Source: A-LOG Study, 2004, Japan Institute of Highway Economics

Freight measure
objectiv es for
devdeveloping
eloping cities cities
Freight measure
objectives
for
0.4
0.3

Infra U rban

0.2

Env ironment

0.1

Efficiency

0
Distrib.

Road links

center

Parking,

Info sy stem

L/U

Freight

Road

regulation

pricing

Freight measure

Freight measure objectiv es for dev eloped cities

Freight measure objectives for developed cities

0.25
0.2

Infra U rban

0.15

Env ironment

0.1

Efficiency

0.05
0
Distrib.
center

Road links

Parking,

Info

Freight

Road

L/U

sy stem

regulation

pricing

Freight measure

Source: A-LOG Study, 2007, Japan Institute of Highway Economics

Freight transport characteristics of cities

Source: A-LOG Study, 2007, Japan Institute of Highway Economics

Impedances that City Logistics can Address

related to Maritime Logistics in Urban Areas:
Landside access to seaports:
Inadequate landside infrastructure can incur additional
costs because of:
damage to goods
higher maintenance and repairs to motor vehicles
congestion causing time delays in transit from site to
site, impacting on quality and potentially generating
public safety issues for perishables
weight restrictions dictating the need to carry loads
smaller than the vehicles capacity
safety risks to users and the community
insecure cargo from use of smaller, open vehicles
Source: AusAid East ASEAN Initiative Maritime Logistics Pilot (EAI MLP), 2009

Additional Issues related to Maritime

Logistics in Urban Areas City
Logistics can Address::

Imbalance in cargo movements/flows

Low port handling productivity
Limited space for port expansion
Storage: Container depots; transit
storage; cool/cold storage
Lack of integrated regional transport
planning
Tariff misalignment
Source: AusAid East ASEAN Initiative Maritime Logistics Pilot (EAI MLP), 2009

KEY ISSUES AND THEIR IMPACT ON EXPORT PERFORMANCE IN

EASTERN INDONESIA AND SOUTHERN PHILIPPINES

Source: AusAid East ASEAN Initiative Maritime Logistics Pilot (EAI MLP), 2009

EAI Strategies where City Logistics can

help in addressing Identified Issues:
Develop integrated port and logistics sector
policy and planning
Identify hub ports, key feeder ports and local
ports: include among the feeder ports fishing
ports in Eastern Indonesia
Tailor investment in facilities and equipment to
support these defined roles
Protect or secure land for future development
of port and port related facilities
Identify port access roads and other common
user logistics facilities

City Logistics can help in Developing a seamless and sustainable

Low Carbon Intermodal Logistics Network
that will support efficient flow of urban
freight movements in green development
economies
Reverse Logistics
Green Logistics
Urban Logistics

Hussein S. Lidasan, Ph.D.

hussein.lidasan@up.edu.ph
thosl76@yahoo.com