Discrepencies in RI-Singapore trade figures seen as result of smuggling

Discrepencies in RI-Singapore trade figures seen as result of smuggling

Adianto P. Simamora, The Jakarta Post, Jakarta

The reported wide disparities in the data recorded by the
Singaporean and Indonesian governments on bilateral trade between
the two countries would appear to provide further evidence of
rampant smuggling between the two countries, as well as graft in
the Indonesian customs service.

According to some economists, Singapore now needs to fully
reveal the data to help Indonesia crack down on the smugglers,
who have greatly hurt the country's economy.

"This is very important. The Singaporean government must be
ready to openly explain to the Indonesian government about the
trade figures so we can find out what the problems are," Chatib,
of the Institute for Economics and Social Research at the
University of Indonesia's School of Economics, told The Jakarta
Post on Thursday.

"Based on the Singaporean data, the Indonesian government will
be able to ascertain if the differences in the trade figures are
caused by smuggling or under-invoicing," he said.

Minister of Industry and Trade Rini MS. Soewandi and Minister
of Foreign Affairs Hassan Wirajuda voiced complaints during a
press conference on Tuesday about Singapore's reluctance to
unveil its data on trade between the two countries.

Hassan said the Indonesian government had often asked
Singapore to supply of with detailed trade statistics since 1973,
but Singapore had always turned down the request.

Indonesia is not even included on the list of 149 trade
partners in the Singapore Trade Statistics.

Singapore once sent a diplomatic note on the bilateral trade
data, but the note was categorized as confidential and the city
state refused to discuss the matter in any formal forum.

According to the data contained in this note, Indonesia is the
sixth largest trading partner of Singapore, after Hong Kong,
China, Japan, the United States and Malaysia.

The data also says that in 2002 Singapore recorded non-oil
exports to Indonesia amounting to US$5.25 billion, compared to
$2.44 billion as reported by Indonesia's Central Statistics
Agency (BPS). Singapore puts its non-oil imports from Indonesia
at $7.41 billion, compared to $4.6 billion according to BPS data.

"The discrepancy is too high. There must be something going
on. If the Singapore data is correct, then Indonesia has suffered
big losses in import duties," said Sri Adiningsih of Gadjah Mada
University.

The two countries have enjoyed good bilateral trade relations
for a long time now, and are both member of ASEAN, which is
currently in the process of implementing the ASEAN Free Trade
Area (AFTA) agreement.

In 2002, Singapore was one of Indonesia's largest foreign
investors, contributing US$3.3 billion worth of investment.

Singapore has also included high technology products from both
Bintan and Batam islands in its free trade pact with the United
States.

Under the deal, Singapore will be allowed to export high-
technology products assembled on Bintan and Batam to the U.S.
duty free.

Director General of Customs and Excise Eddy Abdurrachman
admitted that he "finds it difficult" to obtain data from the
Singapore customs service.

Hassan said officials of both countries recently met to
discuss the issue, but Singapore demanded that the meeting be an
informal one, and no agreement was reached.

He said that government representatives expected to meet with
the Singaporean government again in August of this year.

Rini warned that Indonesia could take several reprisal
measures if Singapore were to insist on keeping the trade figures
secret, including urging all ships carrying Indonesian goods to
stop over at Malaysia's Klang Port, which is the main competitor
to the port of Singapore.

Analysts said the Singaporean government was intentionally
keeping the trade figures under wraps to protect certain vested
interest groups that have continued to do a lot of contraband
trade with the country, including Indonesian military figures.
Some even said that the administration of former President
Soeharto had actually asked the Singaporean government not to
publish the data.

Local manufacturers have long complained that smuggled goods
are threatening their products on the domestic market.

They claim that smuggling and under-invoicing practices are
made possible by collusion involving corrupt customs officials.