Port havoc may lead to extra costs
By Prapti Widinugraheni
JAKARTA (JP): Foreign shipping companies are threatening to impose additional charges on importers of up to a total of US$70 million a year if congestion at the Tanjung Priok port does not abate.
Chairman of the Indonesian Importers' Association (GINSI) Amiruddin Saud disclosed yesterday that, although foreign shipping companies had not yet made the threat officially, they would not hesitate to do so if conditions at Indonesia's main port of entry did not improve by the middle of this month.
"There is no other way to deal with it than by improving the port's poor performance as soon as possible," Amiruddin, who was in Washington for an Asia-Pacific Economic Cooperation (APEC) meeting on transportation, told The Jakarta Post in a telephone interview yesterday.
He explained that in addition to the regular terminal handling costs, surcharges of $200 would be imposed on each 40-ft container and $100 on each 20-ft feet container shipped by foreign companies and docked at the Tanjung Priok port.
He said that GINSI, which currently has 2,393 members, had already protested against the planned surcharges but admitted that the only way to avoid their imposition was to improve port services and facilities.
Importers are currently required to pay a terminal handling fee of $125 for a 40-ft container and $75 for a 20-ft container.
The Kompas daily quoted Secretary General of the Indonesian National Shipping Association (INSA) Barens Saragih as saying recently that the lengthy period of time needed for ships to dock at Tanjung Priok -- up to five days or more in some cases -- had increased the prices of imported goods by up to 20 percent.
Causes
Barens said the causes for the delays included heavy red tape and poor management at the port. He accused port managers of being unresponsive to INSA's request that it review cargo- handling procedures.
Amir Harbani, president of PT Pelabuhan Indonesia II, which manages the port, put the blame on shipping companies which, he said, failed to present on time the documents required to dock at the port.
The daily quoted Harbani as saying that there were cases in which ships did not have the customs, immigration and quarantine (CIQ) papers required for entry, while others did not have an agent to manage the incoming and outgoing cargoes.
Concurring with Amiruddin, an executive of a private shipping company, who requested anonymity, told the Post that congestion at Tanjung Priok was mainly caused by inadequate port facilities, but added that the cement crisis earlier this year -- which brought in large amounts of imports -- worsened the situation.
He said that Tanjung Priok, which has not been expanded or renovated since colonial times, needed to be upgraded to meet modern standards and increasing development demands.
"The port should be renovated so it can accommodate large, modern fleets with drafts reaching up to 11 meters," he said.
He explained that Tanjung Priok's docks had varying depths, forcing larger ships to anchor offshore before they could be given a space with the suitable depth at the pier.
He said it was naive to think that the delays were caused by incomplete shipping documents because shipping companies, through their agents, would have taken care of the papers at least two days before their ships entered Tanjung Priok.
"These (CIQ) are standard documents which would have been presented at every port before arriving in Jakarta. Besides, ships are now equipped with modern telecommunication instruments which allow them to conduct active communications with their agents and the port authority," he said.
The executive said that a ship's operational costs, either docked or operated, ranged between $10,000 and $15,000 a day. Consequently, delays cause serious financial losses.
The head of Pelabuhan II's public relations office, Harry Sutanto, said in a statement made available to the Post on Tuesday that over the last five years the number of incoming ships had increased by about six percent per year, with 11,130 entering in 1990, 12,106 in 1991, 12,359 in 1992, 13,525 in 1993 and 12,733 in 1994.
Over that period, he said, the volume of goods entering the port had increased by 12 percent each year, with 26.8 tons of goods recorded last year.
Harry said there was currently also an unexpected trend of ships' sizes increasing (in gross tonnage terms) and that there were more ships carrying essential goods, such as cement and rice.
The port currently has docks with a total length of 10,474 meters, with waters of varying depths for both conventional and container vessels.
Harry said that to cut back the length of the waiting time, more docks and facilities would be added, including four harbor cranes which are to start operating in September.
He said that longer working hours of the port authorities had been introduced and attempts were being made to improve coordination between related offices, as stipulated in a decree issued by the minister of transportation last May.