Shipping firms need fund for new vessels

Shipping firms need fund for new vessels

JAKARTA (JP): The Indonesian National Shipowners Association
suggested yesterday that the government introduce measures to
help improve the capability of its members to purchase new
vessels.

Association chairman Firdaus Wadjadi and secretary-general
Barens Th. Saragih told a hearing with the Budgetary Commission
of the House of Representatives yesterday that domestic shipping
firms desperately wanted three concessions to support their
businesses.

"We want the government to create reasonable pricing of
vessels and an easy way to own vessels," Saragih said. "We also
want an easier and cheaper system for the operation of ships."

He said the government, for example, could extend Rp 2 billion
in financial assistance per year to domestic ship operators.

"It's up to the government whether the loans are derived from
banks or other institutions, but the most important thing is that
their interest rates must be competitive," he said.

He acknowledged that the government had introduced measures to
help improve the efficiency of shipping firms, most of which are
freight service companies.

Under rulings introduced earlier this year, for instance,
licensing procedures for ship operations have been simplified and
value-added tax on imports of fishing, freight and passenger
vessels have been eliminated.

Earlier this week the Ministry of Finance also reduced the
income tax rate for domestic shipping companies from 1.8 percent
to 1.2 percent of gross revenues.

However, Firdaus and Saragih said yesterday that shipping
companies are still required to pay various levies.

He explained that domestic shipping companies are still
required to pay several taxes, such as a 7.5 percent tax for the
procurement of particular ships from foreign countries.

Saragih said that the association, set up in 1976, currently
groups about 700 private and state-owned oceanliners. (icn)