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Drawing from Thailand and Vietnam: Crafting an innovative logistics strategy for Indonesia
The logistics performance index has limited relevance as a benchmark for logistics efficiency in a vast archipelago like Indonesia.
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Port affairs: Trucks line up at Tanjung Priok container terminal in North Jakarta on Dec. 7, 2023, as ships are loaded and unloaded. (Antara/Erlangga Bregas Prakoso)
L
ogistics matter for a country’s competitiveness. In a globalized world, it is essential to manufacture products efficiently, with high standards and timely delivery schedules.
However this is not enough, as logistics matter, too. Your product may be good, but if it is too expensive to ship to customers, you have a problem. Logistics are critical in an archipelago such as Indonesia.
Importing fruits and vegetables from neighboring countries and China is often cheaper than producing and trading them locally in Indonesia. In Plaza Senayan shopping mall, Central Jakarta, you can buy roses from Ecuador, though they are also produced in West Java, albeit at a lower quality.
The Indonesian government has recognized the importance of good logistics for its domestic and international competitiveness. In 2012, the government launched its logistics strategy. It was issued as Presidential Decree No. 36/2012 on Indonesia’s logistics blueprint.
The blueprint provides a comprehensive analysis of Indonesia’s logistics challenges. The strategic document provides a detailed plan of no less than 300 actions to be taken by the public and private sector in 2012-2025. Time is almost up, and it is appropriate to think about what is next.
Should Indonesia develop a new blueprint?
To answer this question, we propose to review the following issues: was the blueprint able to meet its goals and expectations? What are the lessons learned from how other countries have tackled their logistics challenges? And what could be the contours of a new logistics strategy?
