Ministry threatens to freeze permits of defiant importers

Adianto P. Simamora, The Jakarta Post, Jakarta

The Ministry of Industry and Trade warned on Thursday it would freeze the special permits, or identification numbers, issued to importers of eight strategic commodities if they refused to submit monthly reports to the ministry.

According to a new regulation, importers of sugar, rice, corn, soybeans, electronic products, footwear, toys, textiles and textile products are required to file monthly reports with the ministry detailing their import activities.

But the ministry's director of imports, Aang K. Adikusumah, said on Thursday that many of the importers had not filed any reports since the regulation came into effect in the middle of May.

"We have sent them (importers) warning letters. If they fail to submit their reports before Sept. 15, we will freeze their identification numbers, leaving them unable to import the commodities," Aang told The Jakarta Post.

The government announced in March its new policy requiring importers of these eight strategic commodities to obtain special identification numbers from the Ministry of Industry and Trade. The policy is meant to curb the smuggling of the commodities into the country.

Local farmers and manufacturers have long complained that rampant smuggling hurts their businesses.

The ministry has issued some 3,218 identification numbers to importers. An importer can obtain more than one identification number.

Aang said no monthly reports had been filed for about 60 percent of the 3,218 identification numbers issued.

The monthly reports are meant to contain such information as types of products imported, import volume, price and country of origin.

The data will help the ministry formulate measures to curb smuggling.

Any deviations in the volume or contents of the imports could prompt the government to revoke identification numbers.

Importers will also have to apply for new identification numbers every five years.

Some 2,214 importers have obtained identification numbers from the Ministry of Industry and Trade.

Data from the ministry shows that some 55.5 percent of the importers are based in Jakarta, 30 percent in West Java and some 9.7 percent in East Java.

The ministry said about 36.7 percent were electronics importers, 33.7 percent importers of textiles and textile products, 6.9 percent footwear importers and 6.2 percent sugar importers.

Businesspeople have repeatedly warned that smuggling is causing extensive damage to local industries, and would force many manufacturing companies to shut down their operations and lay off workers.

In response to the problem, the government has formed a special task force comprising several government agencies, including the military and the police, to crack down on smuggling.

Minister of Industry and Trade Rini M.S. Soewandi has also set up a crisis center consisting of dozens of local business associations to help resolve the smuggling problem.