The Indonesian Chamber of Commerce and Industry (Kadin) urged the government Monday to give exact figures for the upcoming fuel price increases to avoid further damaging local industries.
Kadin Chairman Mohammad Hidayat said the delay was fostering market speculations, leading to price rises in other commodities.
The government earlier last week confirmed plans to increase fuel prices on June 1, but continues to mull over the amounts, although a price proposal approved by economic ministers said the increases would average about 30 percent for all types of fuels.
"The government doesn't have to wait until next month as people have already started making their own calculations and pricings," Hidayat said.
"They need certainty before prices and costs become uncontrollable," he said, adding that the confusion would continue to jeopardize the competitiveness of local industries as they estimated the consequences of facing higher fuel prices.
Citing the statements of members of the Organization of Land Transportation Owners (Organda), which he met that day, Hidayat said transportation costs would likely increase in proportion to the price of fuel.
"If transportation costs are that high, our exports growth will definitely suffer as selling prices would also go up," he said, "As a result, our exports would become less competitive to foreign buyers."
He said the country's non-oil and gas exports would likely miss the average 13.5 percent growth target set by the government earlier last month.
Last year in the sector, Indonesia booked $91.94 million in exports, up 15.51 percent from a year earlier.
Organda reported that goods transportation and freight costs for foreign and domestic shipments were estimated to increase by around 20 to 30 percent and that the rental fees for loading and unloading at Tanjung Priok port would increase by an average of 100 percent.
In addition to high transportation costs, many studies, including by the Asia Foundation, show business players in Indonesia are forced to pay high illegal fees to pay off police and government officials.
The bribes raise operational costs for an average truck by 10 percent per year, undermining the country's international competitiveness.
Indonesia's transportation infrastructure recently ranked 91st among 131 countries surveyed by the World Economic Forum, dropping from 89th position last year.
The country ranked 54th out of 131 in a competitiveness study, and 123rd out of 178 countries in a survey by the World Bank in 2007, up from 131 a year earlier, while its Southeast Asia competitors ranked better, including Vietnam at 91st, and Brunei Darussalam at 78th.
The business survey analyzes conditions including facilities for setting up new businesses, simplicity of licensing procedures and investor protection.
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