The Potential is There for BIMP-EAGA’s Maritime Logistics
Jakarta. The maritime logistics sector appears to be quite promising for the BIMP-EAGA, and Indonesia is calling on other member countries of the ASEAN subregion to team up to become a "global logistics power".
The BIMP-EAGA stands for Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area. The sub-regional initiative focuses on driving growth in the resource-rich yet less developed areas within the said four ASEAN member states. In Indonesia, BIMP-EAGA encompasses the provinces of Kalimantan, Sulawesi, the island chain of Maluku, and Papua.
“Those four ASEAN countries should team up to improve their ports into a single force that will eventually become a global logistics power. We are fortunate to be in the middle of the European and China’s logistics vortex,” Transport Minister Budi Karya Sumadi said at the 2023 Maritime BIMP-EAGA conference in Jakarta.
According to Budi, maritime transport is the backbone of international trade. The minister has also instructed state-owned port operator Pelindo to come up with tangible plans to turn this global logistics hub dream into a reality.
“Indonesia is home to many ports. While this may be a boon, we have to boost the competitiveness of these ports which are widespread [across the archipelago]. Pelindo should also decide on which ports can become a hub,” Budi said.
Indonesia is currently working on the Makassar New Port in South Sulawesi in a bid to improve its connectivity with the BIMP-EAGA countries. News outlet Antara reported that its construction progress has reached 93.86 percent. President Joko “Jokowi” is scheduled to inaugurate the Makassar New Port this July.
An official at the Indonesian Chamber of Commerce and Industry (Kadin) also spoke of the maritime potential that lies in the BIMP-EAGA region.
“The BIMP-EAGA is strategically located between major shipping lanes, providing potential for the development of port facilities and other related industries,” Akbar Djohan, the head of logistics and supply chain at Kadin, told the same conference.
Aside from its strategic location, the BIMP-EAGA is a large market of over 70 million people. It is also abundant in natural resources, including fisheries. However, the four-member group faces two challenges, one being a lack of infrastructure, particularly in transportation, communications, and power generation.
It is also little to no harmony of policies between the four member countries. This makes it difficult for businesses to operate across borders, according to Akbar.
“We need to boost infrastructure investment to maximize the opportunities in the BIMP-EAGA’s maritime region and address the said challenges,” Akbar told the conference.
“There should also be an increased cooperation between the member countries to foster a more business-friendly environment,” Akbar said, while also calling for greater support for micro, small, and medium enterprises (MSMEs).