Preshipment inspection maintained

Preshipment inspection maintained

JAKARTA (JP): The government will maintain the pre-shipment
inspection system by extending its contract with PT Surveyor
Indonesia (PT SI) to carry out the inspection of Indonesia's
imports.

The contract, which was signed here on Monday and announced
yesterday, gives authority to PT SI to inspect all goods imported
into Indonesia at points of loading for the next two years.

PT SI also extended its technical assistance agreement with
the Geneva-based Societe Generale de Surveillance (SGS) for
another two years, effective immediately.

Munti Yarso, PT SI's spokesman, said Faried Sybli Barchia of
PT SI and H.J. Vischer of SGS signed the technical assistance
contract yesterday.

However, Munti declined to mention the value of the contract.

PT SI, with 18 overseas branch offices, claims that it has
been inspecting 85 percent of Indonesia's total non-oil imports.

Extending PT SI's contract should cool down the debates over
the inspection system that have lately roiled the House, which is
deliberating a new customs bill.

The associations of Indonesian importers, exporters and ship-
owners have expressed their support for the pre-shipment
inspection system.

Amiruddin Saud, chairman of the Association of Indonesian
Importers, hailed the government's decision yesterday to extend
their contract with PT SI.

"Importers now feel relieved after this decision," Amiruddin
said after learning of the extension.

He added that importers had refrained from opening letters of
credits prior to July 31, the end of the contract between the
government and PT SI, due to uncertainty surrounding the
inspection system.

Amiruddin repeatedly argued that the pre-shipment inspection
system has greatly facilitated the flow of imports by cutting
importing costs and by minimizing administrative irregularities
and under-invoicing.

Meanwhile, the directorate general of customs and excise,
which was stripped of its import inspection authority in the
middle of 1985, has lobbied strongly to have its inspection
authority restored.

Director General of Customs and Excise Soehardjo said here
yesterday that in the long run the pre-shipment inspection would
not effectively facilitate import flows.

Soehardjo said the directors general of customs from the
Association of Southeast Asian Nations (ASEAN), who met in
Tretes, East Java, last month, had agreed not to use the pre-
shipment inspection system for trade within the ASEAN Free Trade
Area (AFTA) after the year 2003.

"The forum of ASEAN directors generals of customs in Tretes
saw the pre-shipment inspection as a trade barrier and agreed not
to use it among ASEAN countries after the implementation of
AFTA," Soehardjo said.

The pre-shipment inspection was introduced in Indonesia in
1985, under a presidential decree which stripped the directorate
general of customs and excise of its inspection authority. The
government then assigned SGS to inspect Indonesia's imports at
points of loading.

After the government set up PT SI in 1991 in a joint venture
with SGS, the main contract for inspection was awarded to PT SI,
which then hired SGS as a subcontractor. PT SI is expected to
eventually take over the whole inspection process from SGS.(rid)