Govt should eliminate nontariff barriers: Ginsi<\/p>\n
JAKARTA (JP): Importers urged the government yesterday to
\nabolish immediately nontariff barriers on imports of chemical and
\nplastic products to cut the soaring production costs of local
\nindustries.<\/p>\n
Chairman of the Indonesian Importers Association (Ginsi)
\nAmirudin Saud said the elimination of the import barriers would
\nlower the domestic selling price of imported items by about 30
\npercent.<\/p>\n
There are 191 commodities which at present should be imported
\nthrough certain importing companies. They include chemicals,
\nplastics, and milk.<\/p>\n
\"The barriers should be abolished so that those commodities
\ncould be sold at lower prices on the domestic market,\" he told
\nreporters after meeting the Coordinating Minister for Development
\nSupervision and Administrative Reforms Hartarto Sastrosoenarto.<\/p>\n
According to Amirudin, the collapse of the rupiah against the
\nU.S. dollar has caused prices of imported goods to rise by more
\nthan 300 percent in rupiah terms. The elimination of the import
\nbarriers would enable the importers to cut their selling prices,
\nhe said.<\/p>\n
He explained that under the existing trading mechanism,
\nimporters are required to pay a 5 percent to 10 percent fee to
\ncertain companies appointed to administer the restricted
\ncommodities.<\/p>\n
\"The special importing companies must no longer exist,\" he
\nsaid, adding that many of the appointed importers were not
\nactually importers but merely doing administrative work.<\/p>\n
He pointed out on state-owned trading companies PT Tjipta
\nNiaga, PT Kerta Niaga, and PT Dharma Niaga.<\/p>\n
\"We import the products but we have to get some papers from
\nthe companies to get our imports from the port,\" Amirudin said.<\/p>\n
Amirudin said that in addition to the administration fee, the
\nimporters of the 191 commodities had to pay an import duty of up
\nto 35 percent.<\/p>\n
In its agreement with the IMF, the government promised to
\neliminate all nontariff barriers as part of the sweeping economic
\nreforms, but no target date has been decided.<\/p>\n
Tariff barriers on most products have been cut to 5 percent.
\nChemical, metal and fishery products wills also be reduced to
\nbetween 5 percent and 10 percent in 2003.<\/p>\n
L\/Cs<\/p>\n
Indonesian importers have also been badly hit by the rejection
\nof Indonesian letters of credit (L\/Cs) since confidence in the
\nlocal banks collapsed.<\/p>\n
The L\/C guarantees provided by Bank Indonesia and certain
\nforeign governments have not been effective because local banks
\nhave demanded importers provide 100 percent of the cash up front
\nto open an L\/C.<\/p>\n
Amirudin also asked the government to return the loading and
\nunloading of commodities to shipping companies to make the
\nprocess more efficient.<\/p>\n
He pointed out that the current loading and unloading process
\ndone by private companies could take more than 21 days which was
\nconsidered too long and exceeded the time limit allowed by
\ninsurers.<\/p>\n
He explained that the loading and unloading companies at
\nTanjung Priok port, which handle some 70 percent of the country's
\nimport and export activities, have enjoyed an annual profit of
\naround Rp 1 trillion (US$77 million) from processing 40 tons of
\nexports, imports and intra-island trade activities.<\/p>\n
\"This large amount of money should be given to the shipping
\ncompanies to improve their operations,\" he said, adding that
\nprior to 1985, the loading and unloading activities were handled
\nby the shipping companies. (rei)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-should-eliminate-nontariff-barriers-ginsi-1447893297",
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"sponsor": "Okusi Associates",
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