Govt to regulate sea cargo rule

Govt to regulate sea cargo rule

JAKARTA (JP): High rates of taxes, levies and lending interest
have discouraged investors from operating cargo vessels carrying
the Indonesian flag, Minister of Transportation Haryanto
Dhanutirto said yesterday.

"Out of the total vessels transporting the country's exports
and imports, only 3.6 percent use the Indonesian flag, while the
other 96.4 percent carry foreign flags," he told reporters after
delivering a speech at a seminar on "Tourism, Telecommunications
and Transportation & AFTA 2000".

He said that out of the ships carrying foreign flags, 15
percent are owned by Indonesian companies based in other
countries.

Therefore, Haryanto said, his office has proposed to the
Ministry of Finance that they revise tax rates on vessels
operated by Indonesian-based firms.

He acknowledged that Indonesian shipping companies have also
complained about Indonesia's high interest rates, which reach
about 18 percent per annum.

"In Singapore, for instance, interest rates are only about two
percent a year," he said.

Haryanto also said that the government will continue to
improve services at the country's seaports, to anticipate the
increasing flow of goods after the implementation of the ASEAN
Free Trade Area (AFTA) agreement in 2003.

He explained that during the current Sixth Five Year
Development Plan period, the government is constructing and
developing 131 seaports, of which 16 will have container
terminals.

Several dry ports will also be ready soon to support cargo
shippings, including those in Bandung (West Java), Solo (Central
Java) and Cirebon (West Java), Jember (East Java), Palembang
(South Sumatra) and Tebing Tinggi (North Sumatra).

He also said that a number of Indonesia's airports will be
modernized, or relocated to anticipate the boom of the country's
tourist industry in the Seventh Five Year Development Plan
period, when Indonesia expects the industry to be the main
foreign exchange earner.

Tourism

Minister of Tourism, Post and Telecommunications Joop Ave told
the seminar that the country may fail to attract more than six
million tourists per annum by the end of the sixth plan period
due to a lack of adequate infrastructure, such as airports and
hotels.

Last year, more than four million foreign tourists visited
Indonesia, indicating a 17.72 percent increase from 3.4 million
in 1993. Indonesia, which received US$4.7 billion from the sector
in 1994, expects to earn more than $5 billion in revenues from
some 4.65 million overseas visitors this year.

The government has also set a target to attract 6.5 million
visitors per annum, with a total spending of $8.9 billion by 1998
and more than 10 million foreign visitors per annum by 2003,
bringing in at least $12 billion. (icn)