The Philippines Ports Authority (PPA) is building capacity that will enable it to use blockchain technology to monitor port activities. The PPA has awarded Shiptek Solutions Corp. (XLOG), a blockchain-based logistics company, a PHP900 million ($16.9 million) procurement contract for its container tagging and tracking project.
The project is called the Trusted Operator Program-Container Registry Monitoring System (TOP-CRMS) and Empty Container Storage Shared Service Facility. The local news outlet, the Inquirer.net, reports that the PPA expects the project to help it ease congestion at the country’s ports and improve the efficiency of supply chains.
In the award notice, the General Manager of the PPA, Jay Daniel Santiago, told Shiptek Solutions to commence work on the project immediately.
“Accordingly, you are hereby instructed to commence with the work, perform the services under the terms and conditions of the contract in accordance with the implementation for the said project, effective upon receipt of this Notice to Proceed,” he said.
As part of the project, Shiptek Solutions is to deploy its expertise in digital documentation, online booking, fleet management, payment systems, tracking of shipments, container insurance, and financial management in the country’s biggest ports.
These ports include the Port of Manila, Manila International Container Terminal, Manila South Harbor, as well as three other economic zones. Shippers, transport services, and consignees using these ports will be allowed to track, insure, and pay for transactions online.
The journey so far for Shiptek Solutions
The award of the contract received pushback from several groups, including the Philippine Exporters Confederation Inc. and the Supply Chain Management Association of the Philippines. The groups warn that the move could potentially disrupt the delicate balance of commerce at ports and negatively impact port activities.
Regardless, Shiptek Solutions remains optimistic that it can expand its services to the rest of Southeast Asia. The company’s founder and CEO noted that the expansion would allow the company to become the main shipping technology provider in the region.
The company, founded in 2018, aims to join other blockchain technology-adopting shipping giants like Maersk and Singapore’s Pacific International Lines (PIL) to bring more efficiency and transparency to the shipping industry.
Notably, the UnionBank of the Philippines owns a 30% stake in the logistics company. UnionBank has long been a champion of blockchain adoption in the Philippines. Recently, the universal bank became the first financial institution to issue a digital peso bond offering using blockchain technology.