Calls to abolish THCs intensify

The Jakarta Post, Jakarta

The country's exporters have become the latest group to call for the abolishment of terminal handling charges (THCs) imposed by shipping firms grouped under the Overseas Shipowner Representatives Association (OSRA).

The Indonesian Exporters Association (GPEI) said on Thursday the government should lower the country's high-cost economy by streamlining procedures, fighting illegal levies and abolishing harbor charges such as THCs and bills of loading (B/L) fees in ports.

With the government planning soon to raise fuel prices, it was high time for measures to ease the burden on exporters, GPEI chairman Amirudin Saud said.

"Although it won't burden us significantly, fuel price hikes will add about 5 percent to our transportation costs. Therefore, the government should compensate us by cutting high-cost economies, especially scraping the THCs," he said.

Amirudin said the government should abolish the charges, which were not regulated by any laws in the country.

"Ban THCs! They are illegal fees imposed by foreign companies. The government must have the courage to do this," he said, adding that the ban would help boost trade activities and benefit the country in the long-run.

At present, he said, exporters have to pay a THC of US$150 for a 20-foot container and $230 for a 40-foot container -- which on average make up about 10 percent of the total shipping costs they have to bear.

The government and exporters, Amirudin said, should not be afraid of a possible boycott by OSRA members because Indonesia's huge export transactions would eventually attract many other shipping firms, which were not OSRA members.

"From Tanjung Priok Port only, our exporters send roughly 3 million containers of goods every year. Nationally, it can reach about 5 million containers.

"Many other shipping companies, which don't impose THCs, will come to serve our exporters (should there be a boycott)," Amirudin said.

GPEI's calls came only days after the Federation of ASEAN Shippers Council (FASC) announced plans to bring the THCs issue to the World Trade Organization (WTO).

FASC said that ASEAN shippers, which group exporters and importers in the region, spent $3.6 billion for THCs in 2002, while Indonesian shippers spent $1.5 billion on THCs last year. (006)