Customs service wants to negotiate over new U.S. import policy

Customs service wants to negotiate over new U.S. import policy

Rendi A. Witular, The Jakarta Post, Jakarta

The government will negotiate with the U.S. customs to allow for
the physical inspection of Indonesian exports destined for the
American market to be conducted at Indonesian ports so as to
minimize costs for local exporters, an official said.

Director for inspection and investigation at the Directorate
General of Customs and Excise Sofyan Permana told The Jakarta
Post on Friday that the customs service had sufficient container
X-ray scanning facilities at the main Tanjung Priok port (two
units) and Surabaya port (one unit), but needed financial
assistance to fully operate the equipment.

He said that for the full operation of each scanner, the
customs service needed at least US$1 million per year.

Sofyan hoped the U.S. government would provide the necessary
financial assistance.

The U.S. government last month imposed a new customs policy
called the Container Security Initiative, forcing a number of
countries to ship their exports for physical inspection in
appointed international ports before entering the U.S. market.
The move is part of the efforts to minimize the terrorist threat
to the U.S.

Indonesian exports, for instance, must first be inspected in
Singapore.

The controversial policy has been criticized by local
exporters, saying that the move would create additional costs and
new trade uncertainties.

The U.S. is one of Indonesia's main export markets for
manufactured and agricultural products.

Some 75 percent of Indonesia's exports to the U.S. have always
been shipped via Singapore due to a lack of capacity in local
ports.

This may be the reason why top economic ministers have not
complained vociferously about the controversial policy. Since
Indonesia finally decided to cooperate fully with the U.S. effort
to fight terrorism, any U.S. policy that could harm Indonesia's
exports to that country might be expected to draw strong
criticism from the government.

"I understand that many exporters have protested against the
CSI policy. That's why we want to negotiate with the U.S. customs
service," Sofyan said.

Under the CSI policy, exporters must file a report with the
U.S. customs listing the goods they plan to ship to the U.S. 24
hours prior to loading, otherwise the products would not be
allowed to enter the U.S. and the exporters would have to bear
the cost of storage or reexport.

Exporters are also burdened with an additional cost of around
$25 for using the U.S. customs' automated manifest system for
submitting such reports as well as the cost of inspections under
the CSI regulations.

If an error, whether intentional or unintentionally, is found
in the report, the U.S. customs will fine the exporter around
US$5,000.

Based on this, local exports that are suspected of being high
risk must undergo physical inspection in a designated port such
as Singapore before entering the U.S.