Export award criteria need revision

Eva C. Komandjaja, The Jakarta Post, Jakarta

The government is being urged to revise the criteria for next year's Primaniyarta award, an export award given to successful exporters, because in previous years it has been awarded mainly to Indonesia-based foreign companies instead of local companies.

Harmen Sembiring of the National Agency for Export Development (BPEN) said on Friday that the government should revise the four criteria in the award, which are absolute export value increase (30 percent from the total score), relative export value increase (30 percent), market diversification (15 percent) and product diversification (25 percent).

Harmen suggested the percentage for the absolute export value criteria be reduced, and the market diversification or product diversification be given a bigger proportion because those are the key indicators in penetrating the global market nowadays.

He also said that the scores should correspond to the level of difficulty of penetrating each export market. European countries and the United States have a higher level of difficulty compared to Asian and African countries since they apply many regulations to protect their consumers, which create difficulties for Indonesian exporters.

Meanwhile, John Situmeang of the University of Indonesia (UI) said the government should not measure exports only from the point of total growth, but also from the local companies contributing to the export value.

He said that foreign companies such as PT Samsung Electronics Indonesia, which won the previous Primaniyarta award, only exploited Indonesia as a plant and market site, with the side effect of increasing Indonesia's export value.

But he expressed concern that if foreign companies one day decided to relocate their plants outside Indonesia, severe damage would be done to the export value.

Therefore, John said that Indonesia should encourage local exporters, and not rely on foreign companies to boost exports.