Govt to cut port fees
Anissa S. Febrina and Urip Hudiono, The Jakarta Post/Jakarta
Indonesian exporters and importers have been cut some slack amid recent economic downturns as the government plans to soon reduce the cost of container handling charges (CHC) at ports by an average of 30 percent.
After weeks of negotiations, industry associations, port operators and several related ministries set in a meeting on Friday a CHC of US$70 per 20-foot container with a maximum terminal handling charge (THC) of around 35 percent.
The new estimation would bring down the total THC cost from $150 to $95 per 20-foot container, said Indonesian Shipowners Association chairman Oentoro Surya who attended the meeting.
CHC is the main component for foreign shipping companies in deciding the amount of the terminal handling charge (THC), which represents a burden to exporters and importers apart from actual shipment costs.
THC is a kind of surcharge a shipping line imposes on its customers, over and above the overall ocean freight rates, to help cover extra operational costs in terminals such as paying illegal fees to port operators and security officers.
Separately, Minister of Transportation Hatta Radjasa explained that the finalization of the new scheme was scheduled for Monday after talks with port operators.
Previous data on container handling costs reveals that a 40- foot container would cost $40 more, while a charge of 75 percent of the full cost was applicable for an empty container.
The decision was welcomed by industry players, who said it could be the start of the realization of the long-promised reduction in Indonesia's high-cost economy.
With an annual total of 6 million 20-foot containers coming in and out of the country's ports, exporters and importers could save at least $350 billion from the reduction.
The new scheme would boost the competitiveness of Indonesian products on the global market. As a comparison, exporters would pay a THC of $90 for a 20-foot container and $135 for a 40-foot container in Malaysia, or $107 and $158 respectively in Singapore.
Textile Producer Association chairman Benny Soetrisno said that the reduction would help the textile industry be more competitive. "It could save some 250,000 textile workers from possible layoffs," he added.
Meanwhile, Indonesian Furniture Producer Association chairman Sae Tanangga Karim explained that even if the lower CHC reduced operating costs by only 2 percent, it could still help industries to survive.
The furniture industry ships between 15,000 to 20,000 20-foot containers every month, from both exports of products and imports of raw material.
"We see this as a good start, as long as the government is consistent in monitoring its implementation by making sure that there will not be any more extra charges," Tanangga said.