Reform improves Indonesia port management<\/p>\n
JAKARTA (JP): Organizational reform has enabled Indonesia to
\nimprove the professional management of its ports to the same
\nlevel as Australia within 10 years, a World Bank report says.<\/p>\n
\"Ten years after the reform process started, the port
\ncorporations face the market test,\" the bank said in its latest
\nreport on world development.<\/p>\n
The report continued to point out, however, that: \"Competition
\npromises to be tough: A recent survey of foreign investors ranked
\nIndonesia's port infrastructure at about the same level as
\nAustralia's but below others in the region, such as Hong Kong,
\nMalaysia and Singapore.\"<\/p>\n
The report, entitled The World Development Report 1994,
\npraised the Indonesian government's efforts to introduce reform
\nof port management since 1983, under which it has \"corporatized\"
\nits business entities.<\/p>\n
According to the report, \"corporatization\" means that an
\nentity is made subject to standard commercial and tax law,
\naccounting criteria, competition rules and labor law, and is less
\nsusceptible to government interference.<\/p>\n
The report, which was launched by Gregory K. Ingram, a World
\nBank executive involved in its compiling in a seminar here
\nyesterday, said Indonesia has made significant progress in
\ndecentralizing its 300 ports.<\/p>\n
\"In mid-1982 the government decided to decentralize the
\nmanagement of 90 of its ports by creating four new public port
\ncorporations, headquartered at the four largest ports,\" the
\nreport noted.<\/p>\n
Not smooth<\/p>\n
Like other countries, Indonesia's transformation of business
\nentities did not run smoothly, the report said.<\/p>\n
Managers, for example, did not yet have a clear understanding
\nof their responsibilities and accountability and lacked the
\nautonomy to implement reforms they thought were needed, it said.<\/p>\n
\"These problems had been addressed by 1988, when an effective
\ncost control program lowered expenses by five percent and
\nincreased revenue by 20 percent for the largest port
\ncorporation,\" it said, adding that between 1987 and 1992, revenue
\ngrew almost twice as fast as expenses.<\/p>\n
Ingram told the seminar that the government should be in
\nposition both to maintain the \"corporatization\" and to create a
\nbusiness climate which encourages private involvement.<\/p>\n
He reminded those attending the seminar that according the
\nWorld Bank's survey, the causes of poor performance in the
\ninfrastructure business in developing countries, among others,
\nare inadequate management, misallocated investments,
\nunresponsiveness to users and technical inefficiency.<\/p>\n
He, therefore, suggested that a government manage its
\ninfrastructure like a business, not a bureaucracy.<\/p>\n
\"The provision of infrastructure needs to be conceived and run
\nas a service industry that responds to customer demand,\" said
\nIngram at the seminar which was organized by the Faculty of
\nEconomics of the University of Indonesia.<\/p>\n
Anwar Nasution, a lecturer at the university, expressed his
\nconcern that the government is not transparent or open enough in
\nits treatment of the private business sector.<\/p>\n
He said that in addition to the complicated bureaucracy,
\nanother problem was the government's habit of giving special
\ntreatment to certain business conglomerates in relation to
\ndealing with infrastructure projects.<\/p>\n
\"I believe that if disclosure is required in the licensing
\nprocedures for the private sector, the infrastructure business
\nwill grow in a healthy way,\" Anwar said. (fhp)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/reform-improves-indonesia-port-management-1447893297",
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