Business

Govt may close down Bagan
Siapi-Api port

Following apparently uncontrollable smuggling and under-invoicing practices, which have reached alarming levels, the government is considering to shut down Bagan Siapi-Api port in Riau in respect of import activities.

Trade Minister Fahmi Idris said recently these measures would be taken unless the Riau administration, the customs office and the police acted sternly against those trying to smuggle goods especially from neighboring Malaysia and Singapore.

"Because of lack of supervision facilities and capacity, ports such as Bagan Siapi-Api and others throughout the country will be proposed for a shutdown of import activities," he said.

Fahmi believed the Bagan Siapi-Api port was the gateway for the inward smuggling of textile products, which causing huge losses to local manufacturers.

Located in Rokan Hilir regency, the port is located along the busy Malacca strait.

The government is preparing measures to limit imports and aggressively clamp down on illicit imports amid fears the global economic turmoil may prompt exporting countries to dump their products in Indonesia to help offset slowing demand in the United States and Europe.

Sofjan Wanandi, chairman of the Indonesian Employers Association (Apindo), has warned that such attempts by other countries would jeopardize local industries that need to shift sales focus to the domestic market as overseas demand declines.

"I'm afraid foreigners will dump their overproduction of goods on the Indonesian market. This is bad for us because we expect sluggish exports to be compensated for with domestic demand," he said.

Indonesia has more than 100 ports scattered throughout the country, but only 11 ports are authorized to handle import and export activities.

The government is considering to limit the range of imports that can be handled in specified ports to help strengthen supervision.

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