Abidin Hasibuan, the president director of publicly listed electronics manufacturer PT Sat Nusapersada, said on Thursday that container shipment costs from Batam remained uncompetitive given the poor infrastructure and inefficiency of the area’s main seaport, Batu Ampar Port.

“Shipping containers from Jakarta to Hong Kong is around 50 percent cheaper than from Batam. That doesn’t make sense, as Batam is closer to Hong Kong than Jakarta,” he said during an online discussion held by Media Indonesia.

Furthermore, high electricity and labor costs on the islands also make Batam less competitive than other countries, and that is especially dire for industries relying on exports, according to Abidin.

“We are lucky that the rupiah is still relatively weak compared to the US dollar. If the rupiah strengthens to Rp 12,000 per dollar, then we are done,” he said.

The rupiah gained slightly against the US dollar on Monday at Rp 14,547, an improvement from its steep depreciation in March at around Rp 16,500 per US dollar, the lowest since the 1998 crisis.

The government has taken measures to woo investors with new regulations and tax deals for the Batam FTZ that it expects to aid the region and national economic rebound after the pandemic.

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