- Fanny Octavianus
VIVAnews – The logistics distribution cost in Indonesia is the highest compared to ASEAN members, especially if compared to Malaysia. The logistics cost in Indonesia reaches 17 percent of the overall costs, while Malaysia 8 percent.
According to Chamber of Commerce and Industry (Kadin) Indonesia Vice Chairman of Commerce, Distribution and Logistics, Natsir Mansyur, Indonesia is still inferior to other countries like the Philippines, whose cost is already below 10 percent. Meanwhile Singapore's cost is only 6 percent. The logistics cost is yet to include other costs such as illegal levies.
"The cost of our logistics is 17 percent of the overall costs, if we assume bank interest is 12 percent, 29 percent of total costs that must be spent by the entrepreneur. That excludes the cost of traffic congestion, thugs, and others," said Natsir Mansyur in Jakarta, Friday.
The components of logistics, he went on, are the infrastructure and transportation. If the price of goods is taken into account, the food prices could reach 300 percent.
"The impact is clear, that investors always prefer the country with better competitiveness and better infrastructure as well," he said.
As logistics contain many elements, Natsir advises the government to seriously address this issue. Otherwise Indonesia would be far left behind other countries, especially in 2012 free market (the ASEAN Free Trade Area or AFTA) will apply.
"At least the government is to reduce our logistics cost from 17 percent to 10 percent," he explained.
He said there are several ways the government can do, among others, setting the primary hubs such as Medan port and Tanjung Priok port. "But first the regulation of the set-up, as only the Minister's decree is left. Later on other regions could follow, although sometimes it takes a long time," he said.
Second, by improving the supporting facilities, such as the revitalization of old trucks for land logistical support and allocating budget funds from local entrepreneurs’ investments for the revitalization. "Certainly the price can cheaper than normal, say normally it is Rp600 million, but we can get is at Rp500 million," he said.
Then, said Natsir, for sea logistics, by the revitalization of public shipping. For example, the big ships weighing over 10,000 tons, leave it to foreign companies because nobody owns it in Indonesia.
"For public shipping, thousands of common people are untouched, yet they have a role for the populist economy," said Natsir.
Finally, continued Natsir, for air logistics support, it has to do with the yet overlapping rules. "Logistical problems are huge, logistics is the thing to note, there should be synergy among the parties," he said.
Translated by Indah Lestari
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