Acting Coordinating Minister for the Economy Sri Mulyani Indrawati has urged businesses to help the government root out smuggling, which is supported by a "mafia" teaming up with officials.

Businesses must also take part in combating illegal practices at ports that have smoothed the way for smuggling, she said.

Although numerous attempts have been made to reform the excise and customs office, she said business lobby group Kadin should help out.

"I know that some of my law enforcers are still dodgy because they get paid by businesses despite the reforms I've made," Mulyani told Kadin members Sunday.

"If you are a whistle-blower and really sincere, please help me combat the mafia (at ports) as our common enemy. If not, you too are my common enemy."

Mulyani said smuggling was one of the government's main concerns, particularly since export-oriented countries had lost their markets in the United States and the European Union because of the global economic downturn.

As a consequence, those manufacturing countries were looking to benefit from emerging markets, including Indonesia, by any means, including smuggling, to keep their production capacity intact, she added.

"Threats are coming from China and Vietnam because they see Indonesia, with its 5 percent economic growth, as the right place to throw their products after losing their export markets," she said.

Kadin chairman Mohamad Suleman Hidayat said he acknowledged some businesspeople acted illegally and would "entirely support" the battle against smugglers.

"There must be one or two illegal firms among thousands, and there must also be customs and excise officials that play dirty," he said on the sidelines of the national meeting.

Indonesian Employers Association (Apindo) chairman Sofjan Wanandi has said that some of the 800 to 1,000 electronics-importing firms that had applied for import licenses from the Trade Ministry were allegedly smuggling in their products.

Kadin's recommendations:

1. Keep the economy stable by ensuring the stability of the rupiah exchange rate, improving interbank transactions and providing sufficient liquidity to the financial sector.

2. Provide clear measures for preventing systemic threats to the financial sector, with mechanisms in place that can be implemented promptly if there is a liquidity problem in the banking sector.

3. Accelerate and expand the availability of stimulus packages, including for labor-intensive sectors and small and medium businesses. This includes speeding up tax refunds.

4. Speed up fiscal expansion, particularly for health, education and infrastructure.

5. Implement policies on the agribusiness, food and energy sectors with concerted efforts between central government agencies and those of local administrations.

6. Review the tax structure, including tax cuts and exemptions for certain products to help boost local demand.

7. Resolve problems in the construction of infrastructure and develop the creative industries.

8. Resolve problems of inefficiency in logistics chains, particularly in ports, and illegal fees and other costs imposed by local administrations.

9. Protect local industries and local markets from smuggling based on the rules of the World Trade Organization. Aggressively promote Indonesia as an attractive place for investment.

Popular

Government to permanently relocate 10,000 people after Ruang eruptions

Kokubo's injury time penalty save secures title for Japan

Residents fear for safety as Mount Ruang volcano erupts