Simplified export procedures head reform package<\/p>\n
JAKARTA (JP): The deregulatory package announced by the
\ngovernment yesterday includes the simplification of export and
\ninvestment procedures in addition to the reduction of import
\ntariffs on nearly 1,500 items.<\/p>\n
The simplification of export procedures includes the increase
\nin the maximum value of export goods which are not required to
\nobtain export declaration documents (PEB) from Rp 10 million
\n(US$2,450) to Rp 100 million<\/p>\n
Raising the maximum value for the shipment of goods without
\nPEB documents is expected to encourage non-oil exports by
\ncooperatives as well as by small and medium-sized companies.<\/p>\n
The simplification also includes the elimination of pre-
\nshipment inspections on export goods.<\/p>\n
The new deregulatory package also includes the simplification
\nof requirements and procedures to obtain the certificates of
\norigin (SKA) of Indonesian export goods. This facility includes
\nthe reduction of the number of regulations on SKA from 31 to only
\nfour and the reduction of the number of supporting documents to
\ncomplement the SKA from four -- Letter of Credit (L\/C), PEB,
\nInvoice\/Packing List, and Bill of Lading (B\/L) or AW Bill -- to
\nonly two, the PEB and B\/L or AW Bill.<\/p>\n
The government is also giving incentives in the form of
\naccelerated customs services and tax breaks as well as the
\nprovision of banking facilities for export-oriented companies,
\nwhich meet such requirements as owning permanent addresses and
\ntax registration numbers in Indonesia, being good and obedient
\ntaxpayers, never breaking customs laws and regulations and having
\nno debt problems.<\/p>\n
The facility in the banking field as determined by Bank
\nIndonesia includes the expansion of banking services to Africa,
\nEastern Europe and Latin America, in addition to the use of a
\nrediscount facility in accordance with the market rate and the
\nuse of usance L\/Cs for a maximum of two years.<\/p>\n
The local L\/C will also be rediscountable for a maximum of
\nthree months beginning on Dec. 1, this year.<\/p>\n
For a trial period, the facility will be given first to
\ntextile and textile-related products, footwear, electronics,
\nfinished wood and rattan products and leather goods.<\/p>\n
Measures taken to improve the business climate include, among
\nother things, the simplification of regulations for companies
\noperating in industrial zones, the operation of bonded zones and
\nbonded warehouses by private companies, the dispensation of
\nimport activities for foreign-investment manufacturing companies
\nand the simplification of procedures for the importation of waste
\nto be used as industrial raw materials.<\/p>\n
Industrial companies located in industrial zones, for example,
\nare no longer obliged to possess permits related to the location
\nand construction of factories or those related to pollution and
\nother environmental matters as long as they have obtained
\ninvestment approvals from the Investment Coordinating Board.<\/p>\n
In relation to the operation of bonded zones, the new
\nderegulatory package allows the use of bonded zones for
\nwarehousing, processing, exhibiting and limited sales with
\nspecial treatment for customs, excise and taxation.<\/p>\n
Opportunity<\/p>\n
The deregulatory measure, in addition, gives private firms an
\nopportunity to operate bonded zones, which used to have to be
\noperated by state-owned companies.<\/p>\n
Other than for processing areas, bonded zones, therefore, can
\nnow function as warehousing facilities and their operations are
\nopen to the private sector.<\/p>\n
Basically, a bonded zone can be a bonded warehouse, an
\nentreport for exhibition or a duty free shop.<\/p>\n
In order to push non-oil exports and to expand employment
\nopportunities, the government will also allow manufacturing
\ncompanies, with foreign investment (PMA) status, to import
\ncomplementary goods from their offshore affiliates. Such a
\npractice was previously prohibited.<\/p>\n
In addition, companies in bonded zones are also allowed to
\nsell their own products on the domestic market up to the
\nwholesaler-level, a facility which was previously given only to
\njoint venture trading companies.<\/p>\n
Manufacturing companies with a PMA status are also allowed to
\nsell imported complementary goods domestically.<\/p>\n
According to the newly issued measures, the sale of imported
\ncomplementary goods by PMA-status companies on the domestic
\nmarket should, however, be made in the same package as the sale
\nof their own products. Furthermore, the value of such companies'
\nown-product exports should be higher than the value of the
\nimported complimentary goods.<\/p>\n
The procedure for the importation of waste for industrial raw
\nmaterials will be also simplified, in addition to an adjustment
\nof the tariff codes of imported waste.<\/p>\n
Yesterday's deregulatory package also provides the schedules
\nfor tariff reductions stipulated in the deregulatory measures
\nintroduced in May 1995.<\/p>\n
The tariffs on the group of commodities targeted to have the a
\nmaximum tariff of 5 percent in year 2000 will be reduced by 5
\npercent in 1997 and 1999, except for those goods whose tariffs
\nare already 5 percent.<\/p>\n
The tariffs on the group of commodities targeted to achieve a
\nmaximum of 10 percent in year 2000 will also be lowered by five
\npercent in 1996, 1998, 2000 and 2002, except for those already at
\n10 percent.<\/p>\n
The following items are excluded from the tariff schedule
\nreduction: certain agricultural commodities, certain automotive
\nproducts, certain chemical products, and plastic and metal
\nproducts.<\/p>\n
Tariffs on distilled alcohol products and alcoholic beverages
\nwill not be lowered.<\/p>\n
In the May 1995 deregulatory package, import tariffs and
\nsurcharges were divided into two categories. Now the surcharges
\nare eliminated because their definition in the newly issued
\nCustoms Law does not exist.<\/p>\n
According to Minister of Finance Mar'ie Muhammad, the new
\ntariff reduction schedule covers 1,497 tariff codes out of the
\nexisting 7,288 tariffs.<\/p>\n
In addition, the newly issued deregulatory package also
\nsimplifies import licenses, which among other things covers the
\nchange in the import regulations on certain products in order to
\nsmooth the procurement of capital goods and raw materials as well
\nas to increase the efficiency of the domestic industry.<\/p>\n
The deregulatory package also sets guidelines on the
\nintroduction of an anti-dumping measure to overcome possible
\ndumping practices from other countries and in order to protect
\ndomestic industry.<\/p>\n
An anti-dumping committee will be assigned to conduct research
\nto find out any dumping practices by exporters in other countries
\nor subsidized by their governments and to recommend an action
\nplan against such practices.<\/p>\n
The committee is to be chaired by Minister of Industry and
\nTrade Tunky Ariwibowo, assisted by Mar'ie.<\/p>\n
Tunky said that he will soon announce the other members of the
\nanti-dumping committee and issue its technical programs. (hen)<\/p>",
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