Speaking at the FAST Logistics Solutions Forum 2026, Capt. Rodien Paca urged the Philippines to cut rising logistics costs, which could reach 45–49% of product costs.
Paca highlighted key operational bottlenecks, including a 6,000-worker shortage in qualified drivers, inconsistent truck bans, road congestion, and a low national Logistics Performance Index score.
The executive recommended adopting artificial intelligence, strengthening vocational training, and expanding road connectivity to match port capacity and shorten container turnaround times in Cebu.
THE Philippines must improve port efficiency, shipping reliability, road connectivity, workforce development and digitalization to reduce logistics costs and strengthen business competitiveness, a logistics industry executive said.
Speaking at the FAST Logistics Solutions Forum 2026, on Wednesday, Oct. 21, 2026, Capt. Rodien Paca, a maritime leader and entrepreneur, said the country’s archipelagic geography makes efficient coordination among ships, ports, trucks and warehouses essential to moving goods across islands.
He stressed that having ports and transport infrastructure is not enough, saying businesses must also be able to move cargo quickly and affordably from origin to destination.
Paca identified five priorities for the logistics sector: efficient and affordable ports, reliable shipping services, connected road networks, a skilled workforce and digital visibility across supply chain operations.
“Fast, but not too expensive,” he said, describing what businesses need from transport services.
Rising costs, operational bottlenecks
Paca cited high transport costs, traffic congestion, port charges, fuel expenses and fragmented regulations as factors that undermine the efficiency of Philippine logistics operations.
He estimated that logistics accounted for about 27 percent of product costs before the recent fuel price increases, warning that the share could rise to between 45 and 49 percent.
Higher logistics expenses increase the cost of moving goods and can ultimately be passed on to consumers, he said.
He also cited the Philippines’ Logistics Performance Index score of 3.3, compared with Singapore’s 4.3, as an indication of the gap in logistics competitiveness.
Paca said inconsistent truck-ban schedules across cities and municipalities, together with traffic congestion and delays, further complicate cargo movement.
He emphasized that delays translate into financial losses for businesses, making efficiency a concern not only for logistics operators but also for manufacturers, retailers and consumers.
Road connectivity crucial to Cebu
For Cebu, Paca said road access and cargo movement must keep pace with port operations and capacity expansion.
He questioned how the cargo volume could be transported efficiently without sufficient road connectivity between ports, container yards, warehouses and business centers.
Expanding port capacity without addressing road congestion could create additional bottlenecks, he said.
He also highlighted the importance of reducing container turnaround times, arguing that the performance of a logistics hub should be measured by how quickly cargo can be processed and transported beyond the port.
He cited international port operations as examples of how efficient cargo handling can shorten turnaround times, although comparable benchmarks for Cebu were not provided.
Workers shortage threatens operations
The logistics sector also faces challenges in recruiting and retaining qualified workers, particularly truck drivers and prime mover operators, Paca said.
He cited about 6,000 vacancies and 23,000 applicants but said many applicants lack the qualifications needed to fill the available positions. He called for stronger technical and vocational training programs, including certification and skills development for drivers and equipment operators.
Paca said logistics companies face difficulties retaining trained workers because overseas employers offer substantially higher salaries.
He recounted how a trucking operation hired more than 20 drivers, only for many of them to leave within weeks or months.
Despite the risk of losing trained personnel, he argued that businesses must continue investing in workforce development to ensure a steady supply of qualified workers.
AI seen as key to efficiency
Paca also urged logistics companies to adopt artificial intelligence (AI) and other digital technologies to improve productivity and reduce operating expenses.
He said AI could automate administrative tasks, streamline processes and improve operational decision-making, warning that businesses that fail to embrace digital transformation risk falling behind competitors.
He cited his own companies’ use of AI as an example but did not provide independently verifiable figures for the resulting cost savings.
Digital visibility, or the ability to track cargo and monitor operations across the supply chain, is one of the five priorities, he said.
He stressed that technology must complement investments in infrastructure and workforce development rather than be treated as a standalone solution.
Ultimately, he said the competitiveness of Cebu’s logistics sector would depend on its ability to deliver goods reliably, quickly and at a reasonable cost.
Improving ports alone would not be enough, he said, if road congestion, workforce shortages and operational inefficiencies continue to delay cargo movement and increase expenses. / MVG