Imported Components Dominate Shipbuilding Industry

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  • TEMPO/David Priyasidharta

    TEMPO/David Priyasidharta

    TEMPO.CO, Jakarta - The national shipping industry has complained about the high cost of building a ship in local shipyards because 70 percent of the ship components are imported. "The only local components are labor and steel plates," Tjahjono Rusdianto, chairman of the Indonesian Shipping Industry and Offshore Companies Association, said during the Inamarine exhibition in Kemayoran, Jakarta, yesterday.

    According to Tjahjono, shipbuilding costs have become more expensive because the licensing process takes a long time. This protraction is reducing the competitiveness of Indonesia's shipbuilding industry, putting it behind neighboring countries'.

    To overcome the problem, the shipping industry is hoping for the government to pay them more heed. As an archipelagic country, Indonesia should be able to turn the shipping sector into a primary mode of transportation. "There must be a strong political will from the government to help the maritime industry," said Tjahjono.

    Yukki Nugrahawan, chairman of the Indonesian Logistics and Forwarders Association, said that today the local shipbuilding industry is lagging behind foreign companies. A survey by Frost and Sullivan showed that the Indonesian logistics market reached Rp1,400 trillion to Rp1,700 trillion per year, with 85 percent of the domestic market controlled by local companies. Meanwhile, the international market is already controlled by foreign vessels. "We are far from foreign in terms of infrastructure, especially the ship," he said.

    Logistics entrepreneurs are asking the government to protect local businesses from foreign investors' increasingly dominant expansion. "They do not just eye [the Indonesian market], but they are already in it," Yukki said.