The government seeks to cut dwell time at the country's ports to less than two days from the current 2.9 days in the fourth quarter of this year and to reduce logistics costs through policies that provide support for logistics companies, a senior minister said on Monday (26/06). (Antara Photo/Sigid Kurniawan)

Gov't Seeks to Further Cut Dwell Time at Ports in Q4

BY :TABITA DIELA

JUNE 27, 2017

Jakarta. The government seeks to cut dwell time at the country's ports to less than two days from the current 2.9 days in the fourth quarter of this year and to reduce logistics costs through policies that provide support for logistics companies, a senior minister said on Monday (26/06).

"We want the current 2.9 days of dwell time to start moving to 1.9 days in the fourth quarter, by October or November this year," Coordinating Economic Affairs Minister Darmin Nasution said.

Darmin's comment came after the government released its 15th policy package on June 15, aimed at improving the competitiveness of local logistics companies by streamlining and simplifying regulations.

The package was lauded by Moody's Investors Service, saying it is "credit positive" for signaling to investors that there is a renewed focus on improving the investment climate amid political turbulence linked to the recent Jakarta gubernatorial election.

"But we can't do it through only one policy package," Darmin said. "We are still preparing the 16th and 17th policy packages, which will still be in the logistics area."

The target is more ambitious compared to the government's two-day dwell time target at the beginning of this year. Darmin said in January that the government would implement an online system among ministries and other government institutions through the Indonesia National Single Window.

Logistics costs in Indonesia account for 26 percent of the country's gross domestic product, one of the costliest in Asia. The country is far less efficient compared to Singapore (8 percent), Japan (9 percent) and Malaysia (14 percent).

The government is aiming to reduce it to 19 percent of GDP by 2020, while global consulting firm Roland Berger said further port operating model reform and better infrastructure could even improve the cost to 9 percent of GDP by 2035.

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