Paper work set government back $7.2 billion last year

JAKARTA (JP): Indonesia's foreign trade documents cost over US$7.2 billion in 1994, or 10 percent of the total value of the year's exports and imports of US$72.03, an advisor said yesterday.

"I think the cost would (turn out to) have been more than 10 percent of the foreign trade value if we studied the documentation process more thoroughly," Chief Technical Advisor of the United Nations Development Program R.N. Shivpuri told reporters at a press conference.

Shivpuri, who is also a consultant to the National Trade Facilitation Program of the trade ministry, said that the cost of paperwork is projected to increase in absolute terms this year to $8.54 billion this year because of an expected increase in the total export and import value to $85.47 billion.

"The high cost of paperwork has been caused by too many documents, time-consuming procedures and other factors, such as corrupt practices," he said.

He said that there are 121 documents currently in use in Indonesia, generated by exporters, importers, banks and government departments.

"The excessive documentation required for both import and export of goods has grown to such proportions that it is a serious impediment to the healthy expansion of overseas trade," Shivpuri said.

He said the number of documents in use would be reduced from 121 to 11 under a program called the Aligned Documentation System of the United Nations.

The reduction in the number of documents will also reduce the time spent by exporters in filling out the forms from six hours, at present, to 45 minutes, he said.

"Most European countries have been able to reduce the cost of paperwork from 10 percent to four percent by using the Aligned Documentation System," he said.

He said that state-owned company PT Sucofindo had been assigned to promote the use of standard trade documents and to encourage the adoption of the Aligned Documentation System by Indonesian exporters.

He said that most importers and exporters had responded positively to information presented to them about the program.

He acknowledged that the program might be rejected by many government departments which have their own rules or documents, but said that the program was needed to improve efficiency.

He said that the National Trade Facilitation Team would not call upon government institutions to implement the program but only to standardize their procedures.

"A one-roof system is our ultimate goal," he said.

Indonesia now has 30 institutions handling trade documents. Malaysia, the Philippine and Singapore have, respectively, 21, 35 and 15 such institutions.

The chairman of the team, Bakir Hasan, said that all parties should support the program in preparation for the free trade era.

"We need three to five years to promote the program, starting this year. Other countries took about 17 years," he said.

Bakir, who is also the Secretary General of the Ministry of Trade, conceded that his ministry had no power to compel participation in the program. (04)