INSA proposes recovery fund<\/p>\n
Adianto P. Simamora, The Jakarta Post, Jakarta<\/p>\n
The Indonesian National Shipowners Association (INSA) has
\nproposed to the government the establishment of a funding
\ninstitution, the Maritime Recovery Fund (MRF), to boost the
\ncountry's ailing shipping industry, said the newly-appointed
\nchairman of the association, Barens Th. Saragih.<\/p>\n
Barens said that, via the MRF mechanism to finance
\nrevitalization, foreign lenders would be willing to provide loans
\nto obtain the Indonesian government's guarantee to protect their
\ninvestment.<\/p>\n
Association members \"have talked with the government about
\nthis plan,\" he told The Jakarta Post Monday.<\/p>\n
He said that foreign lenders from Japan, Germany, and the U.S.
\nhave expressed interest in providing soft loans to revitalize the
\nshipping industry in Indonesia.<\/p>\n
\"But they wanted a government guarantee before investing
\nhere,\" he noted.<\/p>\n
Barens added that the MRF would manage foreign loans, and that
\nmost of the funds would be used to finance the purchase of new
\nships. \"We need to buy new ships to boost our market share,\" he
\nsaid.<\/p>\n
The association said earlier that local shipping companies had
\nonly a 4.62 percent share in the shipment of goods to and from
\nthe country, while foreign cargo ships transported 95.38 percent
\nof the 354.3 million tons of shipped goods in 2000.<\/p>\n
In the same year, local ships carried only 53.01 percent of
\nthe 152 million tons of goods transported locally, with the
\nremainder transported by foreign vessels.<\/p>\n
It said that the number of domestic ships owned by INSA
\nmembers increased by 16.7 percent to 3.067 units in 2000, while
\ntheir total capacity rose 3.6 percent to 4.2 million deadweight
\ntons.<\/p>\n
Elsewhere, Barens said that the local shipping industry had
\nbeen facing difficulties in obtaining loans from local banks.<\/p>\n
\"The domestic banking sector is hostile ... to the shipping
\nindustry. So it is impossible for us to buy new ships,\" he said.<\/p>\n
Barens also urged the government to treat local shipping
\ncompanies the same way neighboring countries treat theirs so they
\ncan be competitive.<\/p>\n
Barens said that some foreign cargo ships operating in this
\ncountry were actually owned by domestic business players.<\/p>\n
\"They listed their ships overseas because of the government's
\npolicy to impose high tax on ship ownership,\" he said.<\/p>\n
In 1999, the government scrapped value added tax on the
\npurchase and lease of ships, docking and port services to help
\nthe local shipping firms.<\/p>\n
Local shipowners hailed the move, but they said it was not
\nenough as there were still excessive charges not imposed in
\nneighboring countries, including 1.2 percent corporate tax and
\nthe mountainous levies imposed by the port authorities and
\nrelated agencies.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/insa-proposes-recovery-fund-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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