A truck passes by the pinisi ship for unloading at the Sunda Kelapa Harbor, Jakarta, on Nov. 28, 2020. (SP Photo/Ruht Semiono)

Indonesia Joining Asean Customs Transit System Depends on Feasibility Study

BY :JAYANTY NADA SHOFA

DECEMBER 01, 2020

Jakarta. The possibility of Indonesia joining the new online, land-only Asean Custom Transit System, or Acts, depends on the results of the feasibility study, according to Asean Economic Community Deputy Secretary-General Aladdin D. Rillo.

Asean has recently rolled out the Acts to facilitate a seamless flow of goods and bolster economic integration towards the Asean Economic Community Blueprint 2025. 

Acts is an online system that only requires private companies to make a single customs transit declaration when moving goods across multiple countries. Under the Acts, companies no longer need to make repeated customs declarations or change vehicles at each border.

The European Union also supports the program under the Asean Regional Integration Support by the EU (Arise) Plus scheme.

The Acts is now fully operational in six Asean states — Malaysia, Singapore, Thailand, Laos, Cambodia, and Vietnam. The bloc expects Myanmar to join the Acts by 2021.

Unfortunately, the Acts is currently limited to road-based transport, leaving out the remaining sea-connected member states, namely Indonesia, Brunei Darussalam, and the Philippines. There is still a chance for these countries to enjoy the streamlined transit system in the future. 

"I think there are feasibility studies being undertaken by these three countries, particularly to establish to what extent the economic benefits from joining this Acts can be maximized," Rillo told an online press conference on Monday.

"Given the current limitations, I think it is not possible [for the three countries to join now]. But, they are exploring the possibility of joining depending on the outcome of the feasibility study," he said.

According to Rillo, there are plans to increase the vehicle quota, currently capped at 500 trucks per participating country. Asean also looks to expand the Acts to multimodal transport, including waterways and air transport, for better connectivity in the region.

"Transport connectivity is critical in facilitating the movement of goods. If we can explore the different modes of transport using this scheme, I believe it can provide lots of value to the region," Rillo said.

Asean Federation of Forwarders Associations (AFFA) sees their Indonesia and the Philippines' members are enthusiastic towards the system.

"The members in Indonesia were invited to discuss with the Transportation Ministry and the Arise Plus on how to expedite the implementation of the Asean agreements, particularly on multimodal transport as well as the Acts," AFFA's executive director Iman Gandi said.

According to Iman, trades in sea-connected countries have different levels of complexity than their land-linked counterparts. Several initiatives launched in the past have also not seen the expected results.

"From the private sector, we see that more effort must be made for the sea-connected countries, mainly because the current trade is not really balanced. The roll-on and roll-off connectivity between the Philippines and Indonesia was launched a couple of years ago, but the traffic of the goods and volume were not there. The sustainability of the connectivity was not in place," Iman said.

"We should pay more attention not only to the simplicity of the customs system but also how to promote the trade between these countries," he added.

Beyond Trade

With its launch coinciding with the Covid-19 pandemic, Asean sees the Acts as something that goes beyond trade, using the simplified transit system to help combat the virus outbreak.

"The Acts can help with Covid-19 response by accelerating the movements of medical supplies, vaccines, and personal protective equipment within the member states," Asean Secretary-General Lim Jock Hoi said.

"Under the Acts,  the movement of emergency healthcare goods and supplies can be facilitated across the nation's borders without the need for custom guarantees during this difficult period," he said.

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