Indonesia is not on the world maritime trade map

Indonesia is not on the world maritime trade map

Surabaya – Ports in eastern Indonesia play an important role in maritime transportation. In turn, these ports will encourage economic growth and reduce inflation because price disparities between regions will be lower. So far, high logistics costs have caused the price of Pontianak oranges to be more expensive than Chinese oranges.

In fact, the costs for loading and unloading and sending cargo to Papua are much more expensive than to Luxembourg in Europe. “The problem is that every ship returning from the eastern region does not carry much cargo, so the costs are charged to the cargo that departed previously from Java,” said Head of the UGM Center for Transportation and Logistics Studies (Pustral) Danang Parikesit.

Transportation costs can also add 20-25 percent to the final price of agricultural products. In reality, less than 2 percent of agricultural products can be transported by ship. “The high cost of logistics means that Indonesian maritime transportation is not included in the list of world maritime trade maps. “There are only Singapore and Malaysia,” said Danang, who is the General Chair of the Indonesian Transportation Society (MTI).

The theme of sea transportation was the topic of a seminar in the “Sea Exploration” event aboard the KMP Trunojoyo which sailed along the Madura Strait, Tanjung Perak Harbor, to Gresik on September 25 2014. The event held by Pustral UGM was attended by journalists, ITS shipping engineering students, dozens of representatives MTI, as well as officials from the East Java Transportation and Road Transport Department.

According to Danang, ports such as those in Sorong-Papua and Bitung-North Sulawesi can be used as entry points for the 14,000 ships operating in Indonesia. In this way, sea traffic in the eastern region will be busy, reducing the cost of transporting ships whose voyages are currently unscheduled, and encouraging the migration of land to sea transport.

According to Danang, the lack of ship loading and unloading activities, especially at ports in the eastern region, has caused logistics costs to increase by up to 30 percent of the price of raw materials. So far, the efficiency in and out of containers carrying goods from the port is only ten percent.

“Sea Exploration” participants also visited the national shipyard company PT PAL Indonesia. They witnessed the activities of building warships and repairing ships belonging to the TNI and Pertamina. “Currently we are preparing to build a submarine with a target of completion in 2020,” said PT PAL Managing Director Firmansyah Arifin.