Australasia route slashes shipping time to Sydney

Australasia route slashes shipping time to Sydney

Endy M. Bayuni, The Jakarta Post, Jakarta

A new trade route just opened last year will potentially cut the
shipping time of Indonesian goods exported from Java to major
Australian urban centers like Sydney and Melbourne from 21 days
on average at present to just eight days.

But while this promises immense savings in terms of time and
costs (both shipping and inventory), there is just one problem:
There are no regular freighter ships sailing between major
Javanese cities and the port of Darwin, the entry point to this
new Australasia route.

Northern Territory Minister for Asian Relations Paul Henderson
is in town this week heading a delegation to promote the new
trade route in Indonesia, including exploring the possibility of
opening shipping routes between Darwin and Indonesian port cities
like Surabaya and Jakarta.

Currently, more than 90 percent of Indonesian exports to
Australia are shipped to Singapore first before heading to Sydney
or Melbourne, which explains the length of time it takes to ship
them.

"Darwin is the Asian gateway into the Australian market for
Indonesia and Asia," Henderson told a breakfast meeting hosted by
the Indonesia Australia Business Council at the Intercontinental
Hotel Jakarta on Monday.

The Australasia route essentially offers Indonesian and Asian
exporters and importers the chance to ship their products to and
from Darwin, which is located in the northernmost part of
Australia, and have their goods transported by railway all the
way south to Adelaide and then on to Sydney and Melbourne.

The new railway route is made possible since the opening of
the track linking Alice Springs in the heart of the Australian
continent and Darwin last year.

Australian politicians for over 100 years had promised to open
a railway network between Alice Springs and Darwin, Henderson
said.

Recalling the dream of early Northern Territory politicians of
turning Darwin into an Asian gateway, he said: "That dream is now
becoming a reality."

The state government has since been busy preparing Darwin,
including building a new modern port and various other projects
that would support the campaign to turn Darwin into a trade hub
linking Asia and Australia.

The future development of the Northern Territory, a state with
a population of 200,000 is somewhat linked to Asian trade.

Henderson pointed out that Darwin is geographically closer to
Jakarta, Singapore and Balikpapan than to Sydney and Melbourne.

"Darwin looks to the north for economic growth as well as to
the south," he said.

Darwin port is already serving a regular shipping service to
Singapore and one route to Shanghai is on trial service. None is
servicing major ports in the western part of Indonesia while a
few ships are servicing routes to eastern parts of Indonesia.

The potential for the shipping business is immense, Henderson
said.

He said Australia last year exported A$2.9 billion worth of
goods to Indonesia and imported A$3.7 billion from Indonesia. Out
of that, the Northern Territory's exports accounted for a mere
A$130 million and imports A$15 million.

The Northern Territory is also lobbying for the expansion of
pre-shipment inspection for all exports to Indonesia in Darwin.
Such a facility currently is only accorded to exports to ports in
eastern Indonesia.

"This is a proposition that would improve your margin,"
Henderson said of the Australasia trade route. "It's a win-win
proposition to increase two way trade for the two countries."