Local Ship Rule Aids Pelindo III
Eastern Indonesia state port operator Pelindo III says ship visits in ports it manages more than doubled in the first half, due to increasing local activity following the enactment of a new cabotage rule.
Company spokesman Edi Priyanto said ship visits in ports it manages hit a record 36,549 in the January-June period, up 102 percent from a year earlier.
Pelindo III operates 40 seaports in seven provinces — East Java, Central Java, Bali, South Kalimantan, Central Kalimantan, West Nusa Tenggara and East Nusa Tenggara — and plays a central role in ferrying commodities and people between Kalimantan, Bali and the eastern islands.
Edi attributed the rise to the cabotage law, which requires vessels operating in Indonesian waters to register as Indonesian-flagged vessels.
“It has boosted trading activities,” he said in a statement on Sunday.
Indonesia enacted a cabotage law in 2005, but enforcement was delayed for years . It was fully implemented on May 7 last year.
In addition to forcing vessels operating in the country’s waters to register as Indonesian-flagged vessels, it also requires oil and gas rigs to register because it classifies them as foreign shipyards.
Stronger economic activity also boosted ship visits to ports.
The busiest port was Banjarmasin in South Kalimantan, which recorded 7,995 ship visits. Next busiest was Pelabuhan Kotabaru, also in South Kalimantan, which booked 4,184 visits. Pelindo III attributed the rise to increasing mining activities on the island.
Indonesia’s eastern territory is expected to play a greater role in the national economy in the future. The government plans to accelerate growth through the long-term Master Plan for the Acceleration and Expansion of Indonesian Economic Growth (MP3EI).
The plan forecasts gross domestic product to increase more than sixfold over the next 14 years, requiring investment of around Rp 4,000 trillion ($424 billion).