Shipowners ask for govt conducive policy

Shipowners ask for govt conducive policy

The Jakarta Post, Jakarta

The Indonesian National Shipowners Association (INSA) repeated
on Thursday its call on the government to create a conducive
policy to boost the country's ailing shipping industry.

Association chairman Firdaus Wadjdi said local shipowners had
seen their share in the country's shipping market steadily
declining and that the government's help was necessary for them
to be competitive with foreign shipping firms.

"The share of national ships in the domestic market continues
to decline compared with foreign ships," he said in his speech at
the association's annual meeting.

The call for a conducive government policy has been repeated
by the association for the past several years.

According to INSA's 2000 data, the local shipping companies
had only a 4.62 percent share in the shipment of goods to and
from the country, while foreign cargo ships transported 95.38
percent of the 354.3 million tons of shipped goods.

In the same year, local ships carried only 53.01 percent of
the 152 million tons of goods transported locally, with the
remainder transported by foreign ships.

Firdaus noted that the number of domestic ships owned by INSA
members increased by 16.7 percent to 3.067 units in 2000, while
their total capacity rose 3.6 percent to 4.2 million deadweight
tons.

Firdaus cited several obstacles that hamper the development of
local shipping. These include difficulties in obtaining loans
from banks, the long duration of port stay and difficulties in
obtaining fuel oil.

"Also a problem is the blockage of national trade ships and
the seizure of the shipping documents," Firdaus said, but he did
not reveal who blocked the ships and seized the documents.

He said the Indonesian government should treat local shipping
companies the same way neighboring countries treat theirs to
enable them to compete.

Analysts said that many foreign cargo ships operating in this
country were actually owned by domestic business players. They
listed their ships overseas to avoid high tax and bureaucratic
obstacles.

One of the shipping lines Samudra Shipping Ltd moved its base
to Singapore in 1993.

In 1999, the government scrapped value added tax on the
purchase and lease of ships, docking and port services to help
the local shipping firms.

Local shipowners hailed the move, but they said it was not
enough as there were still excessive charges not imposed in
neighboring countries, including 1.2 percent corporate tax and
the mountainous levies imposed by the port authorities and
related agencies.