Foreign Holds 50% of Perak Forwarding

Ocean Week, No. 130/VI
May 24 - June 5, 2007

As many as 20 foreign forwarders are now holding around 50% of forwarding business market at Tanjung Perak Port, while the volume continues to drop. According to East Java Indonesian National Forwarders Association (East Java INFA), total forwarding market volume from Tanjung Perak reached around 18 million tons per annum. "Those foreign forwarders are holding 50% or around 9 to 10 million tons of the Tanjung Perak market," Poernomo Soedewo, East Java INFA Chairman, disclosed in a recent seminar on Empowerment & Entrepreneurship at Hotel Hyatt Regency Surabaya recently.

According to Poernomo, local forwarders should strengthen themselves to build up competitiveness with foreign companies. But, he also expects the government policy to protect local forwarders. "Recently, the government does not filter them, so foreign forwarders can easily expand their business in Indonesia." Moreover, with their strong financial capability and wider network, they can expand their market easily. "They can set up a more competitive tariff," he said.

Recently, INFA also monitor and evaluate its members, the one who become the agents of foreign forwarders in particular. "The result of monitoring will become as recommendation to customs office that has authority to issue ID Card," he said, adding that the activity has been beginning since 2006. More than 900 forwarding companies are member of East Java INFA. However, in the last year, Transport Department has withdrawn business permit of around 350 forwarders, member of INFA. "Their permits in JPT (transportation service) and EMKL (sea expedition) have been withdrawn since they have no activity anymore," he said.

INFA also encourages its member to be more creative, innovative, and competitive in expanding the domestic market in particular. "Now we are still holding the domestic market. But, we will soon loose it in line with the era of globalization, if we do not build up our competitive capability." Dewo explained that East Java forwarding commodities are dominated by agriculture and handicraft products. "Coffee, tobacco, rubber, and handicrafts products are the leading commodities," he said. [dan/ow]