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DP World is upbeat on Philippine growth prospects in the near term and will continue to invest in and explore more opportunities in the country, Asia Pacific chief executive officer and managing director Glen Hilton said
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The Dubai-based global logistics giant is eyeing growing the footprint of port operator Asian Terminals Inc in Visayas and Mindanao
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The optimism in the Philippines prevails amid geopolitical instability, lingering inflation, and climate change continuing to put pressure on supply chains
Dubai-based global logistics giant DP World is upbeat on Philippine growth prospects in the near term and will continue to invest in and explore more opportunities in the country, according to Asia Pacific chief executive officer and managing director Glen Hilton.
“We expect continued growth in the near term driven by robust domestic demand, an expanding middle class and increasing regional trade opportunities,” Hilton told PortCalls in an email interview.
He said DP World is open to exploring opportunities aligned with its aspiration to expand in the country, in particular growing the footprint of listed port operator Asian Terminals Inc (ATI) in Visayas and Mindanao. DP World is ATI’s strategic foreign shareholder; Hilton is ATI’s chairman.
“We look forward to collaborating with the Philippine government on developing more ports in areas outside Luzon, unlocking their immense potential for trade, transport and tourism, and ultimately driving economic development,” he said.
ATI operates mostly out of Luzon — at the Manila South Harbor, Batangas port, and Tanza Container Terminal in Cavite. It also has two off-dock yards in Sta Mesa, Manila and Calamba, Laguna.
In Mindanao, ATI is a shareholder in the cargo operator of Makar Wharf in General Santos.
Hilton noted DP World’s local operations are “aligned to help maintain supply chain resilience in the country and support continued economic development.”
Expansion and upgrades are “with a view of enhancing operational efficiency, productivity and customer experience,” the executive said.
Investment opportunities eyed include within the Central Luzon growth corridor, which accounts for 11% of the Philippine economy, Hilton noted.
Last January, DP World in a meeting with President Ferdinand Marcos, Jr. committed to expand and invest in the Philippines, particularly eyeing to set up an industrial park in Pampanga.
Given the right market size and opportunities and in step with government priorities, such as enhancing agricultural supply chains for food security, Hilton said they are keen to provide seamless end-to-end logistics solutions to the market.
He added the Philippines remains as one of the fastest-growing economies in Asia, with recent trade developments reinforcing the country’s position as a critical node for regional and global supply chains, such as the entry into force of the Regional Comprehensive Economic Partnership (RCEP) in the country in 2023.
DP World in 2024 experienced healthy growth in intra-Asian trade – including to and from the Philippines – and expects the “trend to continue to be a major driver of development in Southeast Asia in the coming years.”
Moreover, Hilton said they anticipate the Philippine shipping industry to “make great strides” following approval of the Maritime Industry Development Plan (MIDP) 2028 earlier this year.
The roadmap aims to achieve a nationally-integrated and globally competitive Philippine maritime industry by 2028.
ATI investments
ATI investments in Manila South Harbor include extension of the Pier 3 berth, which will bring the terminal’s annual capacity to 1.9 million twenty-foot equivalent units from the current 1.45 million TEUs. Two new quay cranes are scheduled to arrive by the first quarter of 2025 to complement the berth expansion.
ATI is also investing in green assets and technologies, including more hybrid and electrified equipment, to reduce carbon emissions. An automated gate system at Manila South Harbor will soon be introduced following the system’s successful pilot in Batangas Container Terminal.
In Batangas, ATI is adding cargo storage facilities for containerized, non-containerized, and rolling shipments in response to industry growth.
On the passenger side, the Batangas passenger terminal building will be further enhanced with the construction of a drop-off zone for passengers arriving on public utility vehicles. The expanded passenger terminal building, the country’s biggest so far, was just inaugurated in April.
This year, the Tanza Container Barge Terminal (TCBT) was also inaugurated. The terminal aims to facilitate smoother and faster transport for goods and raw materials to and from Cavite via barges.
ATI earlier said it is investing a minimum of P2.7 billion in capital expenditures in 2024 in line with its expansion strategy and long-term commitment with the Philippine Ports Authority.
Challenges: geopolitical instability, inflation
The optimism in the Philippines prevails amid geopolitical instability, lingering inflation, and climate change continuing to put pressure on supply chains not just in the Philippines, but everywhere around the world, Hilton noted.
In response to these challenges, he said DP World is expanding its capabilities and solutions to meet diverse customer needs: “We are leveraging our global network and local expertise to adapt to dynamic market conditions. We also continue to invest in green technologies, such as electrification, to enable more sustainable logistics operations.”
Hilton said their investments such as in Manila South Harbor and TCBT supports efforts to address the “need to enhance domestic maritime infrastructure,” highlighted by the approximately 98% of inter-island trade and 40 million local and foreign passengers relying on sea transport.
“At the same time, the cost of logistics in the country – which today could account for up to about a quarter of the price of goods – needs to be brought down,” the executive noted, saying “this can be done in part through investing in technology and digital adoption to make supply chains more streamlined and efficient.”
For example, Hilton said the introduction of digital tracking systems and smart logistics tools will reduce operational bottlenecks, minimize delays, and optimize resource management. “These innovations will create faster turnaround times and lower transportation costs, both inland and through international shipping routes,” he explained.
Another key challenge in the Philippines is the evolving regulatory landscape.
Hilton noted that changes in trade policies, port regulations, environmental standards, and customs procedures can significantly impact supply chain efficiency and operational costs.
In the Philippines, efforts to modernize the maritime and logistics sectors, such as the MIDP 2028 and reforms under the Customs Modernization and Tariff Act, create opportunities but also introduce complexities that businesses must adapt to, Hilton said. Additionally, participation in trade agreements like the RCEP brings new compliance requirements alongside improved market access, he added.
“DP World works closely with the Philippine government and regulatory agencies to stay ahead of evolving policies. We also collaborate closely with local industry stakeholders, such as port authorities, trade associations, and logistics partners to develop tailored solutions to ensure smooth trade operations while complying with new regulations,” Hilton said.
In the face of geopolitical and economic challenges, the DP World executive said they “anticipate businesses to continue pursuing diversification to manage supply chain risks in the region.”
In particular, companies are reorganizing their operations to develop alternative manufacturing and supply chains beyond China.
“In this regard, countries in Southeast Asia – including the Philippines – stand to benefit, and we must continue to build up local logistics infrastructure to attract investments by implementing China + 1 strategies,” Hilton said.
The adoption of frontier technologies like artificial intelligence, Internet of Things (IoT), and blockchain will continue to play an important role in optimizing manufacturing and distribution workflows, addressing inefficiencies and improving transparency.
Hilton explained: “For instance, in APAC, we see machine learning algorithms enhancing demand forecasting, inventory management and route optimization, leading to more efficient and cost-effective operations. IoT devices are already being deployed to enable real-time tracking and monitoring of goods, and blockchain technology is already being used to enhance transparency and traceability in certain sectors. To remain competitive, the Philippines must find ways to incorporate these technologies into their supply chains.” – Roumina Pablo
