Abolition of levies slashes port revenues

Abolition of levies slashes port revenues

JAKARTA (JP): The government's plans to cut back levies may
slash the revenues of state-owned PT Pelabuhan Indonesia III,
which oversees major ports in the eastern part of the country, by
up to Rp 600 million (US$256,850) this year.

Pelabuhan III President Frans Masengi said the removal of a
number of legal fees starting next month will most likely take
place in major ports in South Kalimantan which are overseen by
the firm.

Masengi said that to offset the losses, the management of
Pelabuhan III has instructed the port's officials at all levels
to boost efficiency to reduce expenditures.

The Ministry of Transportation earlier this month abolished
four major types of administration fees and reduced the number of
permits under its jurisdiction as part of the government's drive
to cut the costs of doing businesses in the country.

Among the fees to be abolished are permits related to shipping
and port services. Sea transport authorities are required to
streamline or cut the licensing procedures for shipping and port
services.

Masengi was confident that in spite of the cuts in the firm's
revenues, Pelabuhan III will still be able to reap a profit of Rp
93 billion (US$40.43 million) this year, which will be 15.53
percent higher than last year's profit of Rp 80.5 billion.

Pelabuhan III presently manages 40 ports located in Central
and East Java, Yogyakarta, South Kalimantan, Bali, West and East
Nusa Tenggara and East Timor.

Masengi said 16 of his company's ports currently enjoy a
surplus from their services while 11 suffer losses. The rest
break even. In 1994, 16 of the ports suffered losses.

Masengi said the management of Pelabuhan III will make major
efforts to improve the performance of the ports which are still
recording losses, preferably to a break-even point, since it is
impossible to close down those ports.

"As a state-owned firm, we are committed to social
development, so we cannot only seek maximum profits. Thus, we
must continue operating ports that may not be profitable," he
said, as quoted by Antara. (pwn)