Tax exemption, visa-free entry into eastern Indonesia offered
NUSA DUA, Bali (JP): The Indonesian government has taken various measures to boost the development of eastern Indonesia, including a clearance tax exemption and visa-free entry into the region.
Minister of Communications Giri Suseso Hadihardjono announced here at the end of the Australia Indonesia Development Area (AIDA) ministerial meeting on Thursday that the clearance tax exemption would apply to Indonesians traveling from eastern Indonesian provinces, excluding Bali, to Australia.
The visa-free, short-term entry into Indonesia for foreigners from specified countries, including Australia, covers almost all international ports and airports in eastern Indonesia.
Giri also promised that the government would continue to improve the investment climate in the region.
The government stated that it would open up the wholesale and retail trade to foreign investors, and provide special incentives for business activities in the Integrated Economic Development Area.
In addition, the government will provide tax incentives for certain pioneering industries, including a minimum five year and maximum 12 year income tax exemption for industries located outside of Java and Bali.
"We hope these incentives are attractive enough to bring foreign investors into eastern Indonesia," Giri said after cochairing the AIDA ministerial meeting with Australian foreign minister Alexander Downer.
AIDA is a subregional economic zone linking northern Australia with eastern Indonesia.
Giri said Indonesia accorded AIDA equal status as other subregional economic zones, such as the Indonesia-Malaysia- Singapore Growth Triangle, the Indonesia-Malaysia-Thailand Growth Triangle and the Brunei-Indonesia-Malaysia-Philippines Growth Triangle.
Under the AIDA scheme, Australian and Indonesian customs offices are currently developing a customs preclearance facility in Darwin, Northern Territory, scheduled to begin operation in April.
The facility will enable Australian exports bound for eastern Indonesia to enter the country quickly and proficiently, requiring only that their documents be checked.
To facilitate trade and investment, Australia will also open two new honorary consulates, one in Ambon, Maluku, and one in Ujungpandang, South Sulawesi. Australia recently established honorary consulates in Kupang, East Nusa Tenggara, and Balikpapan, East Kalimantan.
In return, Indonesia has opened an honorary consulate in Brisbane.
Australia also expressed interest in involving Australian companies in Indonesia's interisland system of transportation.
Australian Minister for Transport and Regional Services Nick Minchin said that if allowed, his country had the capacity to serve various interisland routes in Indonesia with ferries.
Giri and Downer said in a joint statement that they agreed to explore the possibility of streamlining the process for Australian and Indonesian firms entering joint ventures in the transportation sector.
Australia was also eager to receive clarification of Indonesia's laws relating to leased vessels.
"Particular priority will be given to an examination of the prospect of enhancing Indonesia's ferry system through the leasing of Australian ferries," they said in the joint statement. (rid)