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Customs and excise office adopts blockchain tech to cut logistics costs
The Directorate General of Customs and Excise is looking to blockchain technology to increase the efficiency of documentation and crossborder shipments, and IBM is happy to help.
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IBM Indonesia president director Tan Wijaya (left) and the IT director of the Directorate General of Customs and Excise, Agus Sudarmadi (second left) pose for a picture after a press briefing in Jakarta on Tuesday. (JP/Eisya Eloksari.)
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he Directorate General of Customs and Excise has adopted blockchain technology for information sharing in an effort to reduce shipping costs and eliminate inefficiency resulting from paper-based processes.
The directorate general announced on Tuesday that it was using IBM and Maersk's TradeLense--one of the most popular open supply chain platforms based on blockchain technology that enables real-time end-to-end information sharing and collaboration.
The office’s information and technology director, Agus Sudarmadi, said a digital transformation was needed to bring down logistics costs and ease document processing at the customs and excise directorate general.
“This technology allows us to use single documentation where everyone involved in the supply chain can see the data,” he said during a press conference on digital transformation. “As such, there is less room for foul play and middlemen.”
He went on to say that the technology could also collect large amounts of data about transborder movements, which would facilitate monitoring and policymaking.
Agus noted that logistics account for 25 percent of the total production costs in Indonesia, higher than the average 10 percent to 15 percent in Malaysia. Making the transportation of goods easier, he said, would make Indonesian products more competitive.
In the World Bank’s 2018 Logistics Performance Index, Indonesia ranked 46th of 160 countries, behind Singapore (ranked 7th) and Thailand (32nd). The nation scored lowest in the region for customs efficiency, such as clearance speed and predictability of formalities.
