Thousands of levies hamper exports

Thousands of levies hamper exports

JAKARTA (JP): Director General of International Trade Anang
Fuad Rivai admitted yesterday that the imposition of over 4,000
levies and the existence of rampant red tape have hampered the
development of Indonesia's exports.

Speaking at a hearing with members of the House of
Representatives' Budgetary Commission, Anang said that in spite
of a series of deregulation measures issued by the government in
recent years, a total of 4,396 levies are still imposed on
business activities at various levels.

The levies consist of 195 fees imposed by local
administrations under the orders of the central government, 941
fees imposed by provincial administrations and 2,802 fees levied
by mayoralty and regency administrations.

Apart from that, 419 fees are imposed by local administrations
by orders of governors and 39 by various trade associations.

"But the government will continue with its deregulation and
reduction of bureaucracy, which will include the removal of
levies imposed both directly and indirectly on export-related
activities," Anang assured.

He refused to elaborate on the total value of the levies, but
the Indonesian Chamber of Commerce and Industry said earlier this
year that the amount of levies -- both legal and illegal -- could
be up to 27 percent of a commodity's production costs.

Anang said yesterday that in spite of fluctuations Indonesia's
trade balance during the 1991-1995 period enjoyed a surplus which
increased by an average of 10 percent a year.

Indonesia's trade surplus, for example, increased from US$3.27
billion in 1991 to $6.68 billion in 1992 and to $8.49 billion in
1993. In the following year, however, the trade surplus declined
to $8.07 billion and plunged to only $4.79 billion in 1995.

Anang explained that most of the surplus during the 1991-1995
period came from oil and gas exports. From its international
trade of non-oil products, however, Indonesia continued to suffer
a deficit except during 1993 and 1994, when it gained a surplus
of $846.8 million and $743.7 million, respectively.

Last year, non-oil trade suffered a $2.76 billion deficit when
imports went up by 27 percent while exports grew by only 13.4
percent.

Anang said that in the last two years, Indonesia suffered a
trade deficit with 12 major trade partners, including Japan,
Germany, Australia, South Korea, Taiwan and China.

Last year, for instance, Indonesia suffered a deficit of $2.49
billion in its trade with Japan, $1.43 billion with Germany,
$1.25 billion with Australia, $956 million with South Korea, $727
million with Taiwan and $447 million with China.

Anang explained that his office is currently carrying out a
number of measures to offset the deficits.

The measures include identifying the products which are most
needed by Indonesia's trade partners, conducting trade diplomacy
to expand the country's export market and identifying the
problems curbing export growth.

Anang said his office carries out routine meetings with
related government offices and conveys the problems his office
identifies to the national deregulation team to be followed up.
(pwn)