ICTSI wins 25-year Iloilo Port contract

By Rjay Zuriaga Castor 

Significant facility improvements are set for the Iloilo Commercial Port Complex (ICPC) after the International Container Terminal Services Inc. (ICTSI) of tycoon Enrique Razonis secured the 25-year cargo-handling contract for the port.

The Philippine Ports Authority (PPA) noted that the notice of award was given to the ICTSI on January 29, just three days after the PPA Bids and Awards Committee issued a resolution that approved the global port management company’s bid.

“We are elated and grateful to be entrusted with the redevelopment of the Iloilo Port. We recognize the port’s pivotal role in driving Iloilo’s economic and social growth,” ICTSI executive vice president Christian Gonzalez said in a statement.

ICTSI will begin its operations of the facility upon contract signing and PPA’s issuance of the Notice to Proceed.

ICTSI’s offer for the 25-year contract involves a concession fee of P750 million for the sixth to 10th year. It is larger than the minimum fixed concession fee of P500 million stated in the contract.

Gonzalez emphasized that ICTSI’s proposal outlines significant investments in infrastructure upgrades, cargo-handling equipment, and operational efficiency measures to transform the Iloilo Port into a premier gateway.

ICTSI currently features a 627-meter operational quay length and 20 hectares of land for container and general cargo storage, warehousing, and other cargo-handling activities.

“I am confident that this strategic move by the PPA, in collaboration with ICTSI, will lead to a revitalized and efficient port complex in Iloilo,” he added.

As the new port handler, the ICTSI will rename the Iloilo Port the Visayas Container Terminal (VCT).

The enhancements to the infrastructure of the soon-to-be VCT are expected to facilitate an increase in international container ship arrivals and streamline the flow of goods in and out of the port.

PPA data showed that cargo throughput in the Visayas reached 38.1 million metric tons from January to September last year, representing approximately 19 percent of the total cargo volume across the country during that period.

With its redevelopment and expansion, the PPA aims to convert ICPC into an exclusive port for international vessels and cargoes to decongest the main gateway in Manila.

Domestic vessels and cargoes will only be allowed in the initial five years of the contract or until completion of the port development project at Fort San Pedro port in Iloilo City proper.

The ICTSI is the sole bidder for the 25-year contract to manage and operate the cargo-handling and related services of the Iloilo Port, according to the PPA.

The Razon-owned company won the contract after it was rebidded on January 11 this year.

In the first bidding on December 18, 2023, the ICTSI’s sole bid was declared failed due to the absence of a notarized Secretary’s Certificate or any legal document confirming ICTSI’s authorization in its Omnibus Sworn Statement.

BOOST TO ECONOMY

Iloilo City Mayor Jerry Treñas has expressed optimism on the boost of the city’s economy with ICTSI leading a comprehensive modernization plan for the ICPC.

“The improvement of our port facilities will pave the way for more international container ship arrivals. It will also have a significant impact on the economic growth of the city and the region,” said Treñas in a statement.

Citing the track record of ICTSI as a port operator, former Ilonggo Senate President Franklin Drilon highlighted the company’s capability to efficiently manage ports and address longstanding congestion issues that have hindered potential investors.

“The decision to partner with ICTSI is a significant step forward in transforming [Iloilo Port}  into a modern, world-class port facility and accommodating more domestic and international shipments. This will position Iloilo as a key driver of economic progress in the Philippines,” he said.

Based on their website, ICTSI operates 32 terminals across 19 countries.