Ports Sector

An Expert's View about Ports in Indonesia

Posted on: 19 Jan 2012

Ports in Indonesia ports are relatively small compared to other countries in South East Asia and require improvements.

Ports Sector in Indonesia Ports in Indonesia ports are relatively small compared to other countries in South East Asia and require improvements. This is of particular concern as sea transportation is a vital aspect of the country’s trading infrastructure carrying over 90% of internationally traded goods. Market overview There are hundreds of small ports throughout Indonesia. Of these, 111 are commercial ports operated by state-owned companies, PT Pelindo I, II, III and IV while only 11 are container ports. Indonesia lacks large scale ports capable of receiving trans-oceanic vessels and the limited port capacity has created a highly inefficient system. As a result, much of Indonesia’s cargo has to go through Malaysia and Singapore. High transaction costs due to port inefficiencies, congestion and border transactions are one of the largest obstacles that prevent Indonesian firm and consumers reaping the full advantage of growing global international trade linkages. Jakarta’s Tanjung Priok port (through which 70% of Indonesia’s container exports and imports pass) is the main international gateway and a major gateway for domestic trade. Limited capacities, congestion and low level of productivity at the port hamper exports and the domestic distribution of products. In 2010, the port handled 4.6 million TEUs. The need to upgrade facilities is recognised by the government and a new drive is underway as part of the national infrastructure development master plan. New ports are being planned to relieve some of the congestion. Key opportunities The Master Plan includes explicitly the urgent need for upgrading of Tanjung Priok port. The decision to develop Kalibaru container port worth IDR 11.7 trillion (approximately US$ 1.3 billion), near Tanjung Priok is expected in early February 2012. The new container port will ease off some of the pressure from Tanjung Priok. The proposed Kalibaru container terminal will have a capacity of up to 6.5 million TEUs as well as host an oil & gas terminal. Further upgrade plans under PT Pelindo I, II, III and IV are underway, including capacity expansion of Tanjung Priok by 1.7 million TEUs, a new terminal in Sorong (Papua), Cimalaya (West Java), a new port in Lamong Bay (Surabaya, East Java). Latest export opportunities –Ports & Logistics Latest export opportunities - Indonesia Getting into the market Presidential Regulation No. 54/2010 which came into effect on 1 January, 2011 governs, among others, procurements by ministries, state-owned enterprises, funded in part or entirely from domestic loans or grants received by the government, financed in part or entirely from international loans or grants. Public tender is the standard method of procurement. In all public tenders, information is published on the procuring entity’s website, the formal notice boards, increasingly, the Electronic Procurement Service portals. Foreign companies are allowed to bid in cooperation with a national company (unless no national company has the ability to provide the goods or services requested) and only on bids that exceed a certain threshold e.g. IDR 100 billion (approximately US$ 10 million) for construction services. Most companies use the website of National Public Procurement Office and printed media as a source of information about calls for tenders. More about doing business in Indonesia Contacts Market intelligence is critical when doing business overseas, and UKTI can provide bespoke market research and support during overseas visits though our chargeable Overseas Market Introduction Service (OMIS). To commission research or for general advice about the market, get in touch with our specialists in country - or contact your local international trade team. ξ Lian Jap, British Embassy Jakarta, Indonesia. Tel: +62 21 2356 5265, fax: +62 21 2356 5352 or email: lian.jap@fco.gov.uk. Contact your local international trade team Major Events Port Initiation & Planning Asia Summit Date: 20-22 February, 2012 Website address: www.portplanningasia.com Indonesia International Infrastructure Conference & Exhibition Date: 2-5 May, 2012 Website address: www.indonesiainfrastructure.org UKTI Events UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows. Latest events – Ports & Logistics Latest events – Indonesia Useful links More about OMIS and other UKTI services for exporters
Posted: 19 January 2012

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