New U.S. terror policies threaten RI exporters

New U.S. terror policies threaten RI exporters

Rendi A. Witular, The Jakarta Post, Jakarta

The new U.S. Container Security Initiative (CSI) policy and
Bioterrorism Act will particularly hurt Indonesia's small and
medium-sized exporters because it will mean additional costs and
other difficulties, an industry leader said.

Chairman of the Indonesian Food and Beverage Association
(Gapmi) Thomas Dharmawan told The Jakarta Post over the weekend
that the government should protest against the U.S. and its new
policies.

"Small and medium-sized exporters will have difficulties in
exporting their goods (to the U.S.)," he said.

He added that exports by small and medium-sized enterprises
(SMEs) accounted for the bulk of the country's non-oil and gas
exports to the U.S., one of Indonesia's main export markets.

The U.S. government enacted the CSI and the Bioterrorism Act
in the aftermath of the Sept. 11 terrorist attack. The policies
are aimed at protecting containerized shipping from being
exploited by terrorists.

Under the new policies, export goods destined for the U.S.
market must first undergo a costly, time-consuming physical
inspection in Singapore.

Exporters must also file a report with U.S. Customs listing
all goods they plan to ship to the U.S. 24 hours prior to
loading, otherwise the products will not be allowed to enter the
U.S. and the exporters will bear the cost of storage or reexport.

Thomas explained that SMEs had been shipping their products in
loose containers along with other items belonging to different
exporters. Such a method is a cost-cutting measure as the export
volume of each exporters is small.

Thomas had received reports that because of the new U.S.
policies, several carriers were now reluctant to ship goods bound
to the U.S. in loose containers due the huge penalty risk and the
longer time needed in completing the physical inspection process.

He said that this was an alarming problem as it would impede
the development of local SMEs.

Loose containers are prone to errors during the reporting of
the manifest to the U.S. Customs which could result in a fine of
around US$5,000.

Thomas said that carriers passing through the inspection
process would have to pay US$25 per hour in fees at the Singapore
port to have the administration forms completed for each type of
product, and another $56 per 15 minutes for a senior official to
check the accuracy of the form.

He said the process could take at least two hours.

The charges will be later passed on to the exporters.

Thomas said that the exporters will also have to pay another
$25-$30 per shipment as a cost for sending the prior notice to
the U.S. Customs.

The above costs were on top of the usual terminal handling
charges (THC) of around $100 per twenty feet equivalent unit
(TEU) and shipping charges which range between $1,100-$1,200 per
TEU.

Thomas said that food and feed products which have already
passed the CSI inspection process in Singapore would still have
to pass the U.S. Food and Drugs Administration screening process
as required by the Bioterrorism Act.

Meanwhile, spokesman of the Office of the Coordinating
Minister for the Economy Mahendra Siregar said the government
would not protest nor negotiate with the U.S. government over the
CSI and the Bioterrorism Act.

Mahendra explained that the government had realized that with
the lack of inspection facilities at the local ports, the country
could not comply with the inspection standards of goods as
required by the U.S.

Moreover, he said, the policies were not only imposed against
Indonesia but every country in the world.

"This is not a trade barrier for only us," he said.