TECHNICAL PAPER TO SUPPORT NPMP DECREE    ACADEMIC PAPER TO SUPPORT NATIONAL               PORT MASTER PLAN DECREECREATING...
TECHNICAL PAPER TO SUPPORT NPMP DECREE
TECHNICAL PAPER TO SUPPORT NPMP DECREEIndonesia Infrastructure InitiativeThis document has been published by the Indonesia...
TECHNICAL PAPER TO SUPPORT NPMP DECREE
TECHNICAL PAPER TO SUPPORT NPMP DECREEACRONYMSADB         Asian Development BankAPPI        Asosiasi Produsen Pupuk Indone...
TECHNICAL PAPER TO SUPPORT NPMP DECREE
TECHNICAL PAPER TO SUPPORT NPMP DECREE                                                          ContentsChapter 1. Introdu...
TECHNICAL PAPER TO SUPPORT NPMP DECREE     4.3.2 Dry Bulk ...................................................................
TECHNICAL PAPER TO SUPPORT NPMP DECREETable 4-13 Low Growth Scenario Forecast of Total Cargo Handled at Indonesian Ports, ...
TECHNICAL PAPER TO SUPPORT NPMP DECREEFigure 4-2 Indonesian Base Case Container Forecast for Domestic and International Tr...
TECHNICAL PAPER TO SUPPORT NPMP DECREEChapter 1. IntroductionAs a nation whose economic growth is heavily dependent on por...
TECHNICAL PAPER TO SUPPORT NPMP DECREEFigure 1-1 NPMP within MP3EI Framework                                              ...
TECHNICAL PAPER TO SUPPORT NPMP DECREEFigure 1-2 NPMP Frameworks                                                          ...
TECHNICAL PAPER TO SUPPORT NPMP DECREEChapter 2. National Port Policy2.1 IntroductionIn very recent years Indonesia has ma...
TECHNICAL PAPER TO SUPPORT NPMP DECREE2.2 BackgroundAs a nation composed of many islands, Indonesia is perhaps the world’s...
TECHNICAL PAPER TO SUPPORT NPMP DECREE       Contracting port business entities to undertake port business activities;   ...
TECHNICAL PAPER TO SUPPORT NPMP DECREEresources, including training and development, will be necessary to support the func...
TECHNICAL PAPER TO SUPPORT NPMP DECREE2.4 Legal ContextShipping Law 17 of 2008 is the “parent” law governing Indonesia’s p...
TECHNICAL PAPER TO SUPPORT NPMP DECREE    costs to port customers, and in the end Indonesia’s producers and consumers, tha...
TECHNICAL PAPER TO SUPPORT NPMP DECREE        Transport to achieve this in cooperation with other relevant agencies in Ind...
TECHNICAL PAPER TO SUPPORT NPMP DECREE       Ensuring that Indonesia’s ports are compliant with the country’s policies. T...
TECHNICAL PAPER TO SUPPORT NPMP DECREEtransport planning process and also to assure port master plans facilitate overall e...
TECHNICAL PAPER TO SUPPORT NPMP DECREEPort HierarchyIndonesia has developed a hierarchical framework to reflect the roles ...
TECHNICAL PAPER TO SUPPORT NPMP DECREE       The DGST will develop a system of indicators for both planning and monitorin...
TECHNICAL PAPER TO SUPPORT NPMP DECREEPort authorities will be expected to provide some justification for the proposed tar...
TECHNICAL PAPER TO SUPPORT NPMP DECREEthe confidentiality of agreements to be protected, unless disclosure is authorized b...
TECHNICAL PAPER TO SUPPORT NPMP DECREECircumstances will change over time, and the regulations should be flexible enough f...
TECHNICAL PAPER TO SUPPORT NPMP DECREEcompetition. Additionally, in order to avoid monopoly or oligopoly effects of vertic...
TECHNICAL PAPER TO SUPPORT NPMP DECREEto seek to reach an amicable settlement between the parties through independent non-...
TECHNICAL PAPER TO SUPPORT NPMP DECREEqualified workers with other sectors. Port authorities and PMUs must offer a nurturi...
TECHNICAL PAPER TO SUPPORT NPMP DECREE2.11 Supporting Effective Port Safety Regulation2.11.1 Critical IssuesEffective safe...
TECHNICAL PAPER TO SUPPORT NPMP DECREEfor assuring compliance by port business entities and users. An ISO 14001 Environmen...
TECHNICAL PAPER TO SUPPORT NPMP DECREEChapter 3. Analysis of Port Traffic and Current PerformanceIn this chapter we presen...
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Academic paper to support npmp decree
Upcoming SlideShare
Loading in...5
×

Academic paper to support npmp decree

1,131

Published on

Published in: Business, Economy & Finance
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
1,131
On Slideshare
0
From Embeds
0
Number of Embeds
4
Actions
Shares
0
Downloads
48
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Academic paper to support npmp decree

  1. 1. TECHNICAL PAPER TO SUPPORT NPMP DECREE ACADEMIC PAPER TO SUPPORT NATIONAL PORT MASTER PLAN DECREECREATING AN EFFICIENT, COMPETITIVE, AND RESPONSIVE PORT SYSTEM FOR INDONESIA January 2012
  2. 2. TECHNICAL PAPER TO SUPPORT NPMP DECREE
  3. 3. TECHNICAL PAPER TO SUPPORT NPMP DECREEIndonesia Infrastructure InitiativeThis document has been published by the Indonesia Infrastructure Initiative (IndII), anAustralian Government funded project designed to promote economic growth in Indonesiaby enhancing the relevance, quality and quantum of infrastructure investment.The views expressed in this report do not necessarily reflect the views of the AustralianIndonesian Partnership or the Australian Government. Please direct any comments orquestions to the IndII Director, tel. +62 (21) 230-6063, fax +62 (21) 3190-2994. Website:www.indii.co.id.AcknowledgementsThis report has been prepared by Nathan Associates Inc. (Dr. Paul Kent, Mr. RichardBlankfeld) assisted by national consultants (Prof. Sudjanadi, Hidayat Mao, SH, DR. Russ BonaFrazila, and Ir. Budiyono Doel Rachman MSc.) and with invaluable support from the IndIIoffice manager (Desi Rahmawati, SE), who was engaged under the Indonesia InfrastructureInitiative (IndII), funded by AusAID, as part of the Activity #244.We would like to extend gratitude to Coordinating Ministry of Economic Affairs, Bappenas,Ministry of Transport, Ministry of Finance, Ministry of State Own Enterprise, Pelindo 1-4,Tanjung Priok and Tanjung Perak Port Authorities, INSA, KPPU and NPMP Counterpart Teamfor their highly support and valuable informations.Thanks should also go to David Ray (IndII Facility Director), David Shelley (IndII TechnicalDirector Transport) for their support and valuable inputs.The support provided by Efi Novara Nefiadi, IndII Sr. Transport Program Officer, is gratefullyacknowledged. Any errors of fact or interpretation are solely those of the author.Dr Paul KentNathan Associates Inc.Jakarta, 12 January 2012
  4. 4. TECHNICAL PAPER TO SUPPORT NPMP DECREE
  5. 5. TECHNICAL PAPER TO SUPPORT NPMP DECREEACRONYMSADB Asian Development BankAPPI Asosiasi Produsen Pupuk Indonesia (Indonesian Fertilizer Association)BPS Badan Pusat Statistic ( Statistic Indonesia)COMTRADE Commodity Trade Statistic DatabaseCPO crude palm oilCY container yardDGST Directorate General of Sea TransportationDWA David Wignall AssociatesDWT dead weight tonnageEIA Energy International StatisticFFB fresh fruit bunchesGDP gross domestic productGoI Government of IndonesiaGR 16 Government Regulation No. 61 of 2009HP horsepowerICT Information and Communication TechnologyIEDC Indonesia Economic Development CorridorIFC International Finance CorporationIMF International Monetary FundISPS International Ship and Port Security CodeJICA Japan International Cooperation AgencyJICT Jakarta International Container TerminalKPPU Commission for the Supervision of Business CompetitionLaw Law on Shipping No. 17 of 2008MENPAN Ministry os State Administrative ReformMoT Ministry of TransportationMP3EI Masterplan Percepatan dan Perluasan Pembangunan Indonesia (The Masterplan for Acceleration and Expansion of Indonesia Economic Development)NPK nitrogen phosphorous and potassiumNPMP National Port Master PlanOPEC Organization of Petroleum Exporting CountriesPA(s) Port Authority(ies)PBEs Port Business EntitiesPELINDO Pelabuhan Indonesia (Port Management State Owned Enterprise)PERUMPEL Perusahaan Umum PelabuhanPMU(s) Port Management Unit(s)PR 67 Presidential Regulation No 67 of 2005PT IIF PT Indonesia Infrastructure FinancePT SMI PT Sarana Multi InfrastrukturRTG Rubber Tired Gantry CraneSEZ Special Economic ZoneSISTRANAS Sistem Transportasi Nasional (National Transport System)TEU twenty foot equivalent unitsTR Technical Report on Development of National Port Master Plan
  6. 6. TECHNICAL PAPER TO SUPPORT NPMP DECREE
  7. 7. TECHNICAL PAPER TO SUPPORT NPMP DECREE ContentsChapter 1. Introduction ......................................................................................................... 1Chapter 2. National Port Policy .............................................................................................. 42.1 Introduction .................................................................................................................... 42.2 Background ..................................................................................................................... 52.3 Indonesia’s Need for Integrated Port Policy ..................................................................... 72.4 Legal Context................................................................................................................... 82.5 Port Sector Vision and Goals ............................................................................................ 82.6 Port Policy Formulation, Implementation and Review.................................................... 10 2.6.1 Critical Issues........................................................................................................ 10 2.6.2 Policy ................................................................................................................... 112.7 Integrated Planning, Facilitation and Performance Monitoring ...................................... 11 2.7.1 Critical Issues........................................................................................................ 11 2.7.2 Policy ................................................................................................................... 132.8 Tariff Regulation ............................................................................................................ 14 2.8.1 Critical Issues........................................................................................................ 14 2.8.2 Tariffs ................................................................................................................... 14 2.8.3 Service Agreements.............................................................................................. 15 2.8.4 Rights of Explanation and Objection ..................................................................... 16 2.8.5 Policy ................................................................................................................... 172.9 Promoting Port Sector Competition ............................................................................... 17 2.9.1 Critical Issues........................................................................................................ 17 2.9.2 Complaints Procedure .......................................................................................... 18 2.9.3 Policy ................................................................................................................... 192.10 Enhance Labor Competitiveness .................................................................................. 19 2.10.1 Critical Issues...................................................................................................... 19 2.10.2 Policy ................................................................................................................. 202.11 Supporting Effective Port Safety Regulation ................................................................. 21 2.11.1 Critical Issues...................................................................................................... 21 2.11.2 Policy ................................................................................................................. 212.12 Supporting Effective Environmental Regulation ........................................................... 21 2.12.1 Critical Issues...................................................................................................... 21 2.12.2 Policy ................................................................................................................. 22Chapter 3. Analysis of Port Traffic and Current Performance ............................................... 233.1 Approach and Data Sources ........................................................................................... 23 3.1.1 DGST Shipping Data Sets ...................................................................................... 23 3.1.2 Pelindo Port Data ................................................................................................. 24 3.1.3 Data from Other Recent Studies of Indonesian Ports ............................................ 243.2 Indonesian Port Traffic 1999-2009 ................................................................................. 24 3.2.1 Indonesian Port Traffic in 2009 ............................................................................. 27Chapter 4. Forecast of Indonesian Port Traffic ..................................................................... 394.1 Approach....................................................................................................................... 394.2 Containers ..................................................................................................................... 39 4.2.1 Forecast of International Container Flows ............................................................ 39 4.2.2 Forecast of Domestic Container Flows .................................................................. 424.3 Other Cargo Types and Commodity Groups ................................................................... 47 4.3.1 General Cargo ...................................................................................................... 47
  8. 8. TECHNICAL PAPER TO SUPPORT NPMP DECREE 4.3.2 Dry Bulk ............................................................................................................... 47 4.3.3 Liquid Bulk............................................................................................................ 524.4 Alternative Traffic Scenarios .......................................................................................... 544.5 Implications of Indonesian Port Traffic Forecast for 2009-2030...................................... 58Chapter 5. Port Location and Development Plan ................................................................. 605.1 Approach and Methodology .......................................................................................... 605.2 Port Facilities and Capacity Assessment ......................................................................... 60 5.2.1 Container and General Cargo Port Facilities .......................................................... 615.3 Strategic Port Development Plan Identified by Government and Pelindos ..................... 735.4 National Port Development Plan.................................................................................... 80 5.4.1 Unit Investment Costs .......................................................................................... 80 5.4.2 Investment Requirements .................................................................................... 825.5 Port Sector Financing ..................................................................................................... 82 5.5.1. Conditions for Attracting Private Sector Investment in Ports ............................... 85 5.5.2. Indonesia’s Legal Framework for Private Sector Investment in Ports ................... 87 5.5.3. Framework of Government Support and Guarantee ............................................ 89 5.5.4. Possible Sources of Funding for Public Sector Investment .................................... 91Chapter 6. Legal, Regulatory and Administrative Actions Needed ........................................ 936.1 Subsidiary Regulations under the Law on Shipping ........................................................ 936.2 Subsidiary Regulations Required under Government Regulation on Port Affairs ............ 936.3 Policy Actions ................................................................................................................ 936.4 Short-Term Initiatives for Facilitating Policy Implementation ......................................... 96LIST OF TABLESTable 3-1 Indonesian Port Traffic by Trade Flow and Cargo Type, 1999 and 2009 ................ 25Table 3-2 Indonesian Port Traffic by Trade Flow and Cargo Type and Principal Commodity,2009 ................................................................................................................................... 28Table 3-3 Indonesian Top 50 Ports for Container Traffic by Trade Flow, 2009 ..................... 31Table 3-4 Indonesian Main Ports for Containers, Selected Years, 1990-2009 ....................... 33Table 4-1 Regression Equation and Statistics for Forecast of Indonesian InternationalContainer Traffic ................................................................................................................. 40Table 4-2 Projected GDP Growth for Selected Regions and Countries, 2011-2030 ............... 41Table 4-3 Base Case Forecast of International Container ..................................................... 42Table 4-4 Characteristics of Container Traffic at JICT, 2000-2009 ......................................... 42Table 4-5 Regression Equation and Statistics for Forecast of Indonesian Domestic ContainerTraffic ................................................................................................................................. 43Table 4-6 Base Case Forecast of Domestic Container Traffic at Indonesian Ports ................. 45Table 4-7 Characteristics of Container Traffic at Pelindo II Ports excluding JICT, 2000-2009 . 45Table 4-8 Base Case Forecast of Total Cargo Handled at Indonesian Ports, 2009-2030 ........ 48Table 4-9 Indonesian Fertilizer Plants and Annual Capacity.................................................. 51Table 4-10 GDP Growth Assumptions for Alternative Traffic Scenarios, 2010-2030 .............. 54Table 4-11 Indonesian Container Traffic under Alternative Growth Scenario, 2009-2030 ..... 55Table 4-12 High Growth Scenario Forecast of Total Cargo Handled at Indonesian Ports, 2009-2030.................................................................................................................................... 57
  9. 9. TECHNICAL PAPER TO SUPPORT NPMP DECREETable 4-13 Low Growth Scenario Forecast of Total Cargo Handled at Indonesian Ports, 2009-2030.................................................................................................................................... 58Table 5-1 Container and General Cargo Berth Facilities at Selected Indonesian Ports, 2011 62Table 5-2 General Cargo and Container Traffic Forecast at Main Indonesian Container Ports,2009-2030 (Base Scenario) .................................................................................................. 63Table 5-3 Container Terminal Berth Capacity Indicators, 2009-2025 .................................... 66Table 5-4 Assumed Indonesian Port Productivity Factors by Type of Facility, 2009-2030...... 67Table 5-5 Capacity Analysis for Main Indonesian Container Ports, 2009 ............................... 68Table 5-6 Capacity Analysis for Main Indonesian Container Ports, 2015 ............................... 70Table 5-7 Capacity Analysis for Main Indonesian Container Ports, 2020 ............................... 71Table 5-8 Capacity Analysis for Main Indonesian Container Ports, 2030 ............................... 72Table 5-9 Range of Unit Cost Estimates for Container Terminal Development andConstruction ...................................................................................................................... 80Table 5-10 Unit Investment Cost for Indonesian Container Terminal Development ............. 81Table 5-11 Port Sector Investment by Economic Corridor and Port Facility 2011-2030 andTotal 2011-2030 ................................................................................................................. 83Table 5-12 Indicative Funding Requirements by Private and Public Sector for Development ofPort Facilities, 2011-2030 .................................................................................................... 85Table 6-1 Regulatory Mandates for the Ministry in Shipping Law No. 17 of 2008 ................. 94Table 6-2 Scope of Government Regulation No. 61 of 2009 ................................................. 94Table 6-3 Actions for Policy Implementation ....................................................................... 95Table 6-4 Near-term Initiatives for Facilitating Policy Implementation ................................. 96LIST OF FIGURESFigure 1-1 NPMP within MP3EI Framework ........................................................................... 2Figure 1-2 NPMP Frameworks ............................................................................................... 3Figure 2-1 Guidelines for Anti-Competitive Pricing Behavior ................................................ 16Figure 2-2 Criteria for Assessing Anti-Competitive Behavior ................................................ 18Figure 3-1 Indonesian Port Traffic by Trade Flow and Cargo Type, 1999 and 2009 ............... 26Figure 3-2 Indonesian Port Traffic by Trade Flow and Cargo Type, 2009 .............................. 27Figure 3-3 Indonesian Top 50 Ports for Total Traffic by Trade Flow, 2009 ........................... 29Figure 3-4 Indonesian Top 50 Ports for Total Traffic by Cargo Type, 2009 ............................ 30Figure 3-5 Indonesian Main Ports for Containers, Selected Years, 1990-2009 ...................... 34Figure 3-6 Major International Trade Flows for Indonesia Container Traffic 2009 ................ 35Figure 3-7 Major Domestic Trade Flows for Indonesia Container Traffic 2009 ...................... 35Figure 3-8 Major International Trade Flows for Indonesia General Cargo Traffic, 2009 ........ 36Figure 3-9 Major Domestic Trade Flows for Indonesia Container Cargo Traffic, 2009 ........... 36Figure 3-10 Major International Trade Flows for Indonesia Dry Bulk Cargo 2009 ................. 37Figure 3-11 Major Domestic Trade Flows for Indonesia Dry Bulk Cargo 2009 ....................... 37Figure 3-12 Major International Trade Flows for Indonesia Liquid Bulk Cargo 2009 ............ 38Figure 3-13 Domestic Trade Flows for Indonesia Liquid Bulk Cargo 2009 ............................. 38Figure 4-1 General Approach for Traffic Forecast................................................................. 39
  10. 10. TECHNICAL PAPER TO SUPPORT NPMP DECREEFigure 4-2 Indonesian Base Case Container Forecast for Domestic and International Trade,2009-2030 .......................................................................................................................... 45Figure 4-3 Indonesian Coal Production, Exports and Domestic Consumption, 1996-2010 .... 49Figure 4-4 Indonesian Urea Plants and Annual Capacity, 2010 ............................................. 51Figure 4-5 Indonesian Crude Oil Production and Consumption, 1999-2009 .......................... 52Figure 4-6 Forecast of Indonesian Total Container Traffic under Alternative GrowthScenarios, 2015-2030 ......................................................................................................... 56Figure 4-7 Forecast of Total Indonesian Port Traffic by Cargo Type Under Alternative GrowthScenarios, 2015-2030 ......................................................................................................... 56Figure 5-1 Investment Requirement Methodology .............................................................. 61Figure 5-2 Location and Forecasted Container Traffic at Main Indonesian Container Ports,2009-2030 ........................................................................................................................... 64Figure 5-3 Sumatra Economic Development Corridor: Port Planning Parameters andStrategies through 2030 ...................................................................................................... 74Figure 5-4 Java Economic Development Corridor: Port Planning Parameters and Strategiesthrough 2030 ...................................................................................................................... 75Figure 5-5 Kalimantan Economic Development Corridor: Port Planning Parameters andStrategies through 2030 ...................................................................................................... 76Figure 5-6 Bali and Nusa Tenggaraa Economic Development Corridor: Port PlanningParameters and Strategies through 2030 ............................................................................ 77Figure 5-7 Sulawesi Economic Development Corridor: Port Planning Parameters andStrategies through 2030 ...................................................................................................... 78Figure 5-8 Papua – Kepulauan Maluku Economic Development Corridor: Port PlanningParameters and Strategies through 2030 ............................................................................ 79Figure 5-9 Port Sector Investment by Economic Corridor and Period ................................... 84Figure 5-10 Port Sector Investment by Economic Corridor and Type of Port Facility 2011-2030.................................................................................................................................... 84LIST OF APPENDICESAppendix A-1 Port Hierarchy ............................................................................................... 99Appendix B-1 Strategic Ports within Sumatra Economic Corridor ....................................... 131Appendix B-2 Strategic Ports within Java Economic Corridor ............................................. 131Appendix B-3 Strategic Ports within Kalimantan Economic Corridor ................................. 132Appendix B-4 Strategic Ports within Sulawesi Economic Corridor ...................................... 132Appendix B-5 Strategic Ports within Bali –Nusa Tenggara Economic Corridor.................... 133Appendix B-6 Strategic Ports within Papua – Kepulauan Maluku Economic Corridor.......... 133Appendix C-1 Port Physical Development Plan by Economic Corridor and Type of PortFacilities, 2011-2030 ......................................................................................................... 135Appendix C-2 Port Sector Investment by Economic Corridor and Type of Facility, 2011-2030......................................................................................................................................... 143
  11. 11. TECHNICAL PAPER TO SUPPORT NPMP DECREEChapter 1. IntroductionAs a nation whose economic growth is heavily dependent on ports, the efficient functioningof Indonesia’s ports is a top priority. Shipping Law No. 17 of 2008 helps advance thatpriority by addressing critical issues of port efficiency, safety, security, and sustainability.The Law calls for port sector institutional reform, the advancement of competition, thedevelopment of a rationalized port development plan, the use of public-private partnershipsfor financing of port projects, the participation of local, regional, and national authorities inthe port planning process, and preparation of a workforce to serve public and private sectorneeds. The multidimensional approach the Law addresses will help Indonesian exportersand importers do what they must to succeed while providing the necessary connectivity --economic and transport – to enable prosperity to reach all Indonesian citizens. Indonesia’sport sector vision reflects the multidimensional role for the country’s ports: An efficient, competitive, and responsive port system that fully supports international domestic trade and promotes economic growth and regional development.Shipping Law No. 17 of 2008 mandates the development of a National Port Master Plan(NPMP). The Plan establishes the policy framework to facilitate achievement of the vision.It also sets forth the requirements for a rationalized approach to port development. ThePlan, encompassed in this document, presents cargo forecasts, port developmentrequirements in the coming years, investment costs, and financing constraints andstrategies, with the final chapter laying out the actions needed to facilitate portmodernization and its integration in both economic development and transport systemframeworks.The underlying theme of the NPMP is integration on several levels – across transportcorridors, between investment and policy and public and private sectors, among levels ofgovernment, and in collaboration with economic development initiatives. They will providea coherent foundation for long-term planning and prudent investment among the partnersinvolved. While this obviously will include public and private investment in new andexpanded infrastructure where the need is demonstrated, it will also be essential to achievemaximum efficiency and capacity out of existing footprints. That will require integratedmeasures addressing issues of policy and administration, and governance and operations, inaddition to building infrastructure. 1
  12. 12. TECHNICAL PAPER TO SUPPORT NPMP DECREEFigure 1-1 NPMP within MP3EI Framework 2
  13. 13. TECHNICAL PAPER TO SUPPORT NPMP DECREEFigure 1-2 NPMP Frameworks 3
  14. 14. TECHNICAL PAPER TO SUPPORT NPMP DECREEChapter 2. National Port Policy2.1 IntroductionIn very recent years Indonesia has made some very important decisions relating to thereform of its port sector. The country passed a new law, Shipping Law 17 of 2008, that callsfor the transformation of its port system from one operated by state-owned monopolycorporations to a port authority system more characteristic of the landlord model with theinducement of competition for providing the range of services offered to port users. Portauthorities are being established and future concession programs are intended to secureneeded investment while expanding the number of rivals seeking to provide port services.This transformation underscores the importance of the Ministry of Transport and DGST indeveloping a policy framework designed to facilitate the Shipping Law’s underlying objectivefor the development of a competitive and efficient port system.This chapter sets forth the policies which the government will adopt in order to achieve theShipping Law’s objectives. This follows the preparation of the Scoping Study Policies andProcedures Report, which identified some of the policy themes open to the government toimplement. The process of developing policies involved consultations with governmentofficials and other stakeholders, site visits, and a review of the Shipping Law andcomplementary regulations. The process also considered other economic developmentinitiatives the government is implementing that may be facilitated in part by the existence ofan efficient port system.The development of a Port Policy for Indonesia was thus conducted in three stages:diagnostic, consultative, and policy formulation. The diagnostic stage consisted of a reviewof existing reports and data, technical site visits to pertinent maritime infrastructure, andextensive interviews with both government and private sector stakeholders. Theconsultative stage consisted of conducting several meetings and a workshop with industrystakeholders on the basis of the National Port Master Plan and the noted Policy andProcedures Report findings. The workshop stimulated discussion among a range ofstakeholder groups and resulted in a number of comments. Having carefully considered thecomments, revisions were made to the Policy and Procedures Report, which set forth policyimplications from the Shipping Law and National Port Master Plan from which port policywould be formulated.In the sections that follow, we first present a background to Indonesia’s port sector policyenvironment, including institutional arrangements and challenges, and recentdevelopments. We then describe the legal context for Indonesian port policy. This isfollowed with the presentation of the port sector vision, mission and strategic objectives anda discussion of the critical issues that influence the development of policy. The chapter thenpresents the policies the government will implement. Initially, four sets of supportingregulations are proposed to be issued to support the implementation of policy. These relateto: (a) port tariff regulation (b) complaint procedure and dispute resolution; (c) safe, secureand environmentally-responsible port operations, and (d) port planning. 4
  15. 15. TECHNICAL PAPER TO SUPPORT NPMP DECREE2.2 BackgroundAs a nation composed of many islands, Indonesia is perhaps the world’s most port-reliantnation. Historically, the main focus of government has been on the administration of its portsystem. In response to government’s call for port sector restructuring, government focus isnow extended to the associated institutional, regulatory and technical issues that need to beaddressed in building a modern port sector.In 1992, Indonesia had installed a system of state-owned enterprises (Pelindos) charged withthe development, administration, and operation of Indonesia’s ports. The institutionalreforms introduced by Shipping Law 17 established a system of landlord port authorities(and related port management units) and also changed the status of the Pelindos to portoperators (port business entities). The port authorities are charged with the developmentand regulation of Indonesia’s ports, but as entities holding civil service status, do not reflectthe wide span of autonomy normally accorded landlord port authorities. And while theShipping Law did not create a new entity overseeing Indonesia’s port administration, thetransformation to the landlord model also indicates a change in the role of the Ministry ofTransport, which is charged in part with issuing regulations related to the implementation ofthe Shipping Law.Indonesia’s new port institutional framework implies a set of new or revised responsibilitiesfor port sector governance. There is a need to ensure clarity about each institution’s rolesand objectives. They must work together effectively in building the port sector. AsIndonesia’s port interests are now housed in separate entities, the Ministry of Transport’sprimary role needs to be clearly defined as including acting as policymaker for the portsector, monitoring the performance of the port system and its individual components, andoverseeing the government’s interests in ports. Shipping Law 17 and its complementaryregulations entrust the Ministry of Transport with responsibility for:  Planning the development of the country’s commercial and non-commercial seaports;  Securing and facilitating investment in port development and improvements;  Promulgating regulations and guidelines for port authorities and PMUs designed to assure effective port sector governance, coordinated and integrated planning, and efficient operation;  Formulating an education and training model to assure effective performance of port-related functions and a ready supply of highly capable port sector human resources;  Approving port authority and PMU tariffs and developing port tariff structures for port business entities;  Issuing permits for port development, construction, operation; and  Approving port authority, PMU, and private sector plans for the development and upgrading of ports.And while the Ministry of Transport’s role can be viewed as one of instituting port policy andoverseeing the port sector, the responsibility for planning and direct supervision of the portsector is housed within port authorities and port management units. To this extent, portauthorities and PMUs are charged with:  Assuring the smooth flow of goods in ports and establishing standards for operational performance;  Provide land and water areas for ports; 5
  16. 16. TECHNICAL PAPER TO SUPPORT NPMP DECREE  Contracting port business entities to undertake port business activities;  Prepare tariffs for services rendered by port authorities and PMUs and submit them for approval by the Ministry of Transport;  Issue regulations governing the use of ports, harbors, and pilotage services;  Prepare local master plans for approval by the Ministry of Transport;  Assure environmental protection in the port areas; and  Facilitate dissemination of port-related information.In 2009, nearly 1 billion tons of cargo were handled in Indonesia’s ports, with about 543million tons (56 percent) and 435 million tons handled in foreign and domestic volumes,respectively. While cargo volumes are substantial, competitiveness is lower thanexpectations. Pelindo subsidiaries arguably compete on the basis of operationalperformance, but competition on the basis of pricing is virtually nonexistent given themajority ownership position of the Pelindos in port business entities. This has been duelargely to barriers to market entry imposed on non-Pelindo affiliated port business entitiesand antitrust protections accorded to state-owned enterprises. Re the former, specialterminal operators are highly restricted from engaging in cargo handling services for thirdparty cargoes and, even if given the required permits to do so, permits are granted for onlyfive years. Though options for renewal are available, it is difficult to imagine a situationwhere an investor can receive financing where there is a risk of non-renewal and the loan’spayback period far exceeds the initial permit period. Re the latter, the KPPU legislationexempts Pelindos, as state-owned enterprises, from antitrust regulation, hence allowingthem to directly engage what would otherwise be prohibited behavior. Additionally,Indonesia currently requires government entities to hold 51% equity in joint venturearrangements involving foreign corporations, discouraging foreign investment in Indonesia’sport sector. Finally, Pelindos are accorded land stewardship responsibility and hence controlof landside port development within their territories.Indonesia can expect continued robust economic growth in the coming years, generallyaveraging about 6.4 percent through 2030. This growth places new demands on operationalefficiency and capacity; failing to meet these demands may constrain expected economicgrowth. Global shipping patterns are in a state of flux as ship sizes increase, a risk ofcontainer carrier overcapacity emerges, and rate instability ensues; shipping lines in turn willseek to minimize port calls in an effort to rationalize their businesses. Efficient modern portfacilities capable of handling the latest generation of container ships and large bulk carriersefficiently are seen as the key to reducing transport costs and hence attracting overseasinvestment and diversifying Indonesia’s manufacturing and trading base. At the same time,Indonesia needs to replicate global best practices and develop a port institutionalframework that is commercially efficient. Such a framework includes an element of planningand control to ensure that development and operations are carried out to the highestinternational standards and hence contribute towards, rather than constrain, theachievement of Indonesia’s goal of accelerated economic development.The port reform process is not yet complete. There are gaps and clarifications needed in theShipping Law and more legislation and regulations may be needed to assure effective policyimplementation. Additionally, the emergence of a competitive port system is dependent onfinding the right people. The newly created port entities will need the ability to recruit andretain a workforce of the highest caliber to undertake the tasks with which they areentrusted. Port authorities will be unable to wrest highly qualified people from othersectors unless compensation rates can exceed the compensation levels bound by currentcivil service rules. Retaining employees also means that effective management of human 6
  17. 17. TECHNICAL PAPER TO SUPPORT NPMP DECREEresources, including training and development, will be necessary to support the functioningof DGST and the port authorities.Access to qualified labor is also a concern for the port business entities. As cargo volumesincrease in the coming years, additional physical capacity will be needed, and there will beincreasing demand for workers to manage and operate these new facilities. Indonesia’s portsector will need a ready supply of qualified workers in order maintain and operate facilitiesat acceptable global standards.2.3 Indonesia’s Need for Integrated Port PolicyThe policies set forth below are intended in part to enhance multimodal and cross-sectoralintegration. Ports can no longer be viewed in isolation of the rest of the transportationsystem and economic development strategy. Hence, policy implies an emphasis on rigorousanalysis and long-term planning in partnerships among government agencies and betweenpublic and private sectors. The emergence of global supply chains as the preeminentbusiness model is a key factor in global economic changes. Propelled by dramatic changes ininformation and transportation technologies, leading-edge production strategies nowfeature deeper integration of production, marketing, transportation, and distribution –commonly referred to as integrative trade. These changes in how businesses operate havesignificant implications for transportation, as pressures mount for greater scale andefficiency in infrastructure systems that support major trade flows.As businesses increase their reliance on seamless, secure, and efficient multi-modaltransport systems as keys to their success, transportation as a whole is being recognized asmore crucial than ever to Indonesia’s competitiveness. Hence, the key for Indonesia’s futuresuccess will be an integrated approach to both policy and physical infrastructure relative toall surface transport modes. This approach places transportation infrastructure at its core,but goes further to encompass other interconnected issues of public policy, regulation, andoperational practices that directly impact how well transport infrastructure works and howwell Indonesia takes advantage of it. As for investment, the crucial role for privateinvestment is highlighted, along with a commitment to policies that foster a positive climatefor it to increase while safeguarding the public interest.The scope of a future maritime policy in Indonesia is potentially wide-ranging. It is inevitablethat the various policies, once approved, will be phased in and may be changed during thecourse of time in view of strategic and other events. This suggests that policies will alsohave to be prioritized and maybe revised. Hence, the Ministry of Transport will relycontinuously on input from stakeholders in identifying the most important policy areas andany needed modifications.Policies are required to ensure that Indonesia’s port sector develops into a world-classcompetitive industry and that the ports are operated in line with international safety andenvironmental standards. The objective should be to ensure that the port sector promotescompetitiveness, facilitates trade, and seamlessly integrates with the multimodal transportlogistics system. To achieve this, a flexible legal and regulatory framework is required thatensures orderly, safe, secure, accessible, and competitive services, high standards ofcorporate governance, and effective economic and technical regulation. It requires a clearpolicy built on consensus and a commitment from policymakers, managers, regulators andstakeholders. 7
  18. 18. TECHNICAL PAPER TO SUPPORT NPMP DECREE2.4 Legal ContextShipping Law 17 of 2008 is the “parent” law governing Indonesia’s ports sector. The Lawcovers both port and shipping matters. Port issues are mainly dealt with in Chapter VII (Arts67 – 115), Chapter XI and in a few scattered provisions elsewhere in the Law. The maintopics covered in Chapter VII of the Law are:  National Port System  Port Master Planning  Institutional Frameworks / Participants in the Port System  Port Construction and Operation  Special Terminals and Own Interest Terminals  Tariffs  Designation of ports open for foreign trade  Role of regional governmentAlso relevant is Chapter XI, which establishes the office of the Harbour Master and definesits powers and functions. The Law is supplemented by various Government and Ministerialregulations issued to give effect to specific provisions. The principal regulations governingport institutions, their roles, functions and duties include:  Government Regulation No 61/2009 regarding port affairs;  MoT Ministerial Regulation No KM 62/2010 on the organization and working procedures of Port Management Units and its amendment (PM 44/2011);  MoT Ministerial Regulation No KM 63/2010 on the organization and working procedures of Port Authorities and its amendment (PM 45/2011);  MoT Ministerial Regulation No KM 64/2010 on the organization and working procedures of the Harbour Master’s Office; and its amendment (PM 46/2011);  MoT Ministerial Regulation No KM 65/2010 on the organization and working procedures of the Batam Port Office and its amendment (PM 47/2011).2.5 Port Sector Vision and GoalsChapter 1 presented the vision for Indonesia’s port sector. The government’s goals forachieving this vision are set out below.  Secure Private Investment. Indonesia’s port sector will require substantial expansion to accommodate higher demand as well as to support economic development initiatives. The scale of investment is such that the public sector cannot cover the cost alone. While private sector participation is key to port development and operations success, government currently has regulations in place that have the effect of discouraging private sector investment. Restrictions to operational scope by special and own-interest terminals, related restrictions on length of permits, and mandatory foreign equity ownership guidelines in terminal infrastructure limit foreign investment and the ability of the private sector to engage in third-party cargo handling.  Institute competition. Indonesia’s port sector is characterized by market dominance. As a result, prices are not determined by market conditions, translating to higher 8
  19. 19. TECHNICAL PAPER TO SUPPORT NPMP DECREE costs to port customers, and in the end Indonesia’s producers and consumers, than what would otherwise exist under fully competitive conditions. Market entry by competitors is constrained by certain provisions in the Shipping Law that should be amended. A light-handed regulatory framework is needed to guard against abuses of market power until such time as it is feasible to introduce more competition, and allow market forces to drive the search for greater efficiencies and lower costs after competition is introduced. The principle to be applied is “competition where possible, regulation when necessary”. Enhance the landlord model of port administration in Indonesia. Indonesia’s port landlord model as currently configured does not reflect international best practice, particularly in regards to the autonomy given landlord ports of other countries. Missing from the existing model is the port authority’s ability to make independent decisions relative to organizational structuring, marketing, pricing, budgeting, financing, procurement, setting compensation levels, and hiring/termination. This has the effect of slowing responsiveness to changing market conditions and constraining inter-port competition that could emerge in future years as hinterland accesses to market catchment areas are improved. Integrate planning. The success of Indonesia’s economic development initiatives depends to a great degree on the port sector’s ability to facilitate implementation of these initiatives while contributing to their success. This is particularly true of the MP3EI, where ports will serve some of the economic activity located along the economic corridors. Port planning must respond to the growing requirements of economic activity and integrate these developments in the development of their master plans. Port development must also be coordinated with national transportation planning and planning decisions cannot be made in isolation of the communities where ports operate; port plans must therefore be in conformity with local land use plans. Create an enabling, flexible, legal and regulatory framework. Indonesia has already embarked on extensive legal reform with the introduction of the Shipping Law and its complementary regulations. However, further legislation and/or regulations are likely to be required to improve integrated and coordinated planning, provide an efficient procedure for regulating tariffs, and allow for light-handed regulation in the event of market failure. Ensure safe and secure port operations. The port sector has to have a good safety record and secure its assets and human resources. In the future this will require more capacity to ensure that safety and security regulation adheres to world class standards and international protocols to which Indonesia is a signatory. Technical capacity must be created to meet these challenges and to cooperate with national authorities in building an efficient safety and security management regime that applies to Indonesia’s ports. Expand protection of the environment. Future port expansion requirements will result in the increased use of coastal waters and new developments along the coastline increase the threat to the marine environment. The port authorities and port management units must be diligent in implementing systems to mitigate such threats, and effective oversight mechanisms must be established by the Ministry of 9
  20. 20. TECHNICAL PAPER TO SUPPORT NPMP DECREE Transport to achieve this in cooperation with other relevant agencies in Indonesia. Systems for implementation include effective emergency response programs.  Develop human resources. The port sector should provide a safe and rewarding work environment with opportunities for career progression and personal development. To become an “employer of choice” in a more competitive labor market, the sector needs to provide attractive employment conditions, challenging and rewarding work, an appropriate work–life balance, and greater opportunities for training and upgrading the skills of the workforce. The ultimate goal is high levels of efficiency within a work environment that balances the interests of workers, employers, and society as a whole. But assuring quality workers begins with preparation well before they are ready to embark on their careers – both vocational institutes and universities must play a role in preparing the port sector workforce. For workers already employed for cargo and vessel handling, training programs must focus on measures for improving productivity while Indonesia must strive to meet global standards for port labor practices. Further, women do not figure prominently in the port sector workforce -- Indonesia must focus on strategies designed to mainstream women in this important sector.2.6 Port Policy Formulation, Implementation and Review2.6.1 Critical IssuesIndonesia’s port governance system is new as is the role of the Ministry of Transport in thisnew landlord form of administration. At the same time, there is a lack of a policy frameworksetting out government’s goals for the sector, how these goals are to be achieved and whowill be responsible for achieving them.It is traditionally the role of line function government departments, such as the Ministry ofTransport and DGST, to undertake policy development and monitor its implementation. Thismust occur on a consultative basis with the involvement of all stakeholders. The processadopted in the development of the National Port Master Plan already establishes a suitableprecedent for stakeholder involvement.Policy is never static and must continuously adapt to changing circumstances. Hence, theMinistry of Transport must also be tasked with reviewing policy on a regular basis to verifythat it still supports the Government’s overall economic and social goals. Legislation is a toolof policy. As Indonesia’s port policy takes shape, legislation must be revised to ensure that itfully enables policy objectives to be achieved.The Ministry of Transport’s work in policy development should be concerned with:  Contributing to the debate on the long-term structure of the port industry by advising on ways of increasing competition. Although the Pelindos currently have superior technical knowledge in this area, it has a major conflict of interest as any increase in competition will automatically weaken its own position. A healthy debate on the issue will enable the government to make a better-informed judgement on the amount and form of competition which is appropriate and time at which it is introduced. The Ministry of Transport’s proposed role in promoting competition is elaborated further below. 10
  21. 21. TECHNICAL PAPER TO SUPPORT NPMP DECREE  Ensuring that Indonesia’s ports are compliant with the country’s policies. The Ministry of Transport will also be expected to represent port sector interests when new policies are being developed at the national level, while DGST must work within the Ministry to assure that prospective Ministry of Transport modal policy incorporates deliberations about the impact modal policy may have on the port sector.  Integrating the port system more effectively with other modes of transport, for example by setting regulations on vehicle weights and drivers hours, or improving highway systems, which do not have the effect of impeding the efficient working of the ports.2.6.2 Policy  The Ministry of Transport will develop capacity to oversee the effective implementation of its proposed policy. It will report regularly to government and stakeholders on progress in achieving policy goals. The Minister of Transport, working through DGST, will from time to time issue guidelines to government institutions and commercial agencies with regard to the implementation of port policy. As appropriate such policy guidelines will be preceded by consultation with key stakeholders.  Business strategies of all stakeholders, including port authorities, PMUs, and port business entities, must be aligned to support government’s port policy objectives. To this end the Ministry of Transport through DGST will enter into a dialogue with stakeholders with regard to those aspects of its plans and budgets that raise issues of port policy. The Ministry of Transport will pursue a structured and open dialogue with stakeholders, via the establishment of stakeholders and/or port user committees, aimed at promoting a broad consensus and seeking to resolve differences in emphasis or approach through a consultative process.  Policy will be regularly reviewed to ensure that it is still responsive to achieving the goals identified for the port sector. A policy review will be undertaken on a three yearly basis and will be integrated with the Ministry of Transport’s strategic planning process. The review process will allow for stakeholder consultation and the reviewed policy will thereafter be published for public notice.  Legislation will be reviewed to ensure that it provides an enabling framework for the Government’s policy goals for the sector.2.7 Integrated Planning, Facilitation and Performance Monitoring2.7.1 Critical IssuesIntegrated PlanningThe Shipping Law has assured a coordinated port planning process. The Ministry ofTransport through DGST is responsible for preparing and updating a national port masterplan (NPMP) every five years with interim updates made as appropriate. Port authoritiesand PMUs are, in turn, responsible for preparing local port master plans in conformity withthe NPMP; but the local master plans must also be aired with local governments to assurethey adhere to local land use planning provisions. There is, however, no provision in the Lawand its complementary regulations to assure plans are part of an integrated national 11
  22. 22. TECHNICAL PAPER TO SUPPORT NPMP DECREEtransport planning process and also to assure port master plans facilitate overall economicdevelopment objectives.It is therefore crucial that the ports are effectively integrated with other transport modesand economic development initiatives. Planning to achieve such integration must occur atvarious levels and among agencies within the national government and the port authoritiesand Pelindos. The challenge is to devise a framework that promotes complementaryplanning and allocates responsibility to each organization on the basis of its mandate anddistinct responsibilities.Typically, it is a core function of transport departments to undertake overall planning for thetransport sector that ensures effective integration of transport modes. The desiredoutcome is a seamless integration of modes that function as a single logistics chain.Experience in many countries demonstrates that where such integrated planning is absent,transport operations are constrained resulting in inefficiencies and higher costs. A goodexample is inadequate road or rail connections to modal interchange points such as ports.An important role of the DGST is to develop a strategic vision of future port requirements, tocoordinate port planning with developments in other sectors of the economy, and to ensurethat the growing volumes of port traffic can be comfortably accommodated on Indonesia’sroad, rail, and interisland transport systems. The primary role of port authorities and PMUsis to undertake the physical planning and oversee construction and operation of portinfrastructure. However, DGST also has an important supporting role in coordinating portauthority plans with those of other government organizations and reviewing port authorityplans from a strategic and operational perspective.Port development plans need to be integrated into wider strategies for economicdevelopment, land use, and environmental protection. It is important to map out clearlyhow this strategic planning process will work, and define the central role of the Ministry oftransport and DGST in coordinating port development plans with those of other entities andsectors. DGST and port authorities may also be required to facilitate consultation on theplans to ensure that the views of all stakeholders are properly taken into account.The Ministry’s port planning responsibility should include the role of overall sectorfacilitation. This entails facilitating between the port sector and stakeholders in bothgovernment and the private sector to ensure that the port system can function at optimalefficiency levels. Worldwide, studies have shown that over 75% of the constraints to portsystem efficiency result from the activities of government agencies such as customs, poorproductivity due to the inefficient use of information technology and logistics practices thatare below par. There is potentially an extensive role to play by the Ministry in securinggreater cooperation between agencies and stakeholders involved in the transport field toensure higher productivity and overall lower port and transport costs.Finally, the Ministry’s overall planning role implies that it must also be in the position toevaluate the efficiency of the transport system and to assess whether policies and plans arecontributing towards higher port productivity and lower costs. This entails developing therequired performance monitoring and data processing capacity. 12
  23. 23. TECHNICAL PAPER TO SUPPORT NPMP DECREEPort HierarchyIndonesia has developed a hierarchical framework to reflect the roles ports play in thecountry’s port system, how they may be integrated in the country’s economic and portplanning processes, how they may be institutionally restructured as national, regional, andlocal assets, and the extent to which they may be financially supported by the governmentof Indonesia.As indicated in the Shipping Law, the port hierarchy consists of 1) main, 2) collector, and 3)feeder ports. Main ports serve domestic and foreign trade, while collector and feeder portsare limited to domestic trade only; main ports are deemed to handle large cargo volumes,while collector ports and feeder ports handle “medium” and “limited” volumes, respectively.Main ports are to be administered by port authorities; collector ports may be administeredby port authorities or PMUs; feeder ports are to be administered by PMUs. Collector portsand feeder ports may also be administered by regional or local governments. How collectorand feeder ports are administered will be determined in close consultation with regional andlocal governments based on their expressed interest to the Ministry in administering theseports or upon the Ministry’s interest to transfer these ports to local and regional control.The current classification of Indonesian ports is presented in Appendix A.2.7.2 Policy  The Ministry of Transport is responsible for coordinating planning of the entire transport system in Indonesia based on sector plans prepared by modal divisions, other modal agencies, and port authorities. To this end, port authorities will cooperate with DGST to ensure that DGST is regularly informed of ongoing planning efforts. The Ministry of Transport will issue planning regulations consisting of requisite planning processes and guidelines to provide a basis for the Ministry’s monitoring of this activity. The Ministry will also require Pelindos and other port business entities to provide port authorities with all relevant detail needed for assessing impacts of their plans on the master plan, and port authorities to provide similar details to the Ministry to coordinate overall transport system planning.  The Ministry will review the status of ports in future years to determine if their hierarchical status should change and what implications there are in terms of revising the prevailing and future National Port Master Plans and in the plans submitted by port authorities and PMUs.  The Ministry of Transport will review port authority development plans from an integrated transport planning perspective and establish a review procedure in the planning regulations. The DGST will promote a continuous dialogue with the port authorities to ensure that DGST is able to effectively execute its regulatory and planning responsibilities.  The Ministry of Transport through DGST will develop capacity to supplement its planning function by undertaking overall sector facilitation. To this end, the Ministry will engage with other government agencies such as customs, and private sector role-players such as freight forwarders and logistics service providers, to continuously review sector performance and adopt practices that eliminate constraints to the optimal functioning of the transport chain. 13
  24. 24. TECHNICAL PAPER TO SUPPORT NPMP DECREE  The DGST will develop a system of indicators for both planning and monitoring performance purposes and publish regular findings of key port performance indicators.2.8 Tariff Regulation2.8.1 Critical IssuesPort authorities and PMUs are required to prepare tariffs for services that they render andsubmit tariffs for review and “stipulation” by the Ministry of Transport. It is important thatthe process of tariff review and approval is well understood by all the parties. The Lawsuggests a “light-handed” regulation approach as tariffs are not imposed; instead, portauthorities are subjected to tariff approval, and eventually, as port authorities and PMUsreflect the global standard approach to landlord administrations, they will make their ownpricing decisionsbased on a combination of commercial and cost recovery principles. In thisinstance, the Ministry of Transport’s role will be limited to ensuring that the tariff complieswith its general tariff guidelines and does not discriminate unfairly or constrain competition.Steps will be taken to ensure short-medium term stability in the published tariff and majoradjustments to the tariff should be relatively rare, unless there are large unforeseen changesin costs. At the same time port authorities will need some flexibility to negotiate tariffs ifthese are needed to bring in new business. The role of the Ministry of Transport is to ensurethat these do not seriously disadvantage other customers, and do not undermine the overallfinancial stability of the port authority by leading to large losses.International best practice generally advocates non-discriminatory treatment ofcustomers—similar tariffs for similar customers receiving a similar service—but this is notalways easy to achieve, as most customers can find something that differentiates them fromothers and can be used to justify a lower tariff.While the Shipping Law does not compel port business entities to submit tariffs for approval,the risk of oligopolistic behavior by port business entities requires that port business entitiessubmit tariffs to enable the Ministry of Transport to monitor for anticompetitive pricingpractices. The tariff setting process should incorporate a formal tariff filing system for portauthorities and port business entities covering both the published tariffs and the tariffsnegotiated with individual port users on the basis of “one-off” service agreements. This willenable the Ministry of Transport to monitor tariffs to ensure that they remain internationallycompetitive, are not the result of collusive behavior, cover costs, and do not unfairlydiscriminate against individual port users. The tariff filing system is expected to operatebroadly as follows.2.8.2 TariffsTariffs are the standard charges by port authorities that apply to all port users unlessotherwise specified. It is anticipated that they will be changed infrequently in order to giveusers a high degree of certainty about the level of port charges, and that the changes will bepreceded by a period of consultation during which users will be able to prepare for theeffects of any proposed changes.Changes to the port tariff will be proposed by port authorities and should be filed with theMinistry of Transport at least 60 working days before their intended date of introduction. Ifthe port authorities receive no comments from the Ministry by 15 working days before theirintended date of introduction they are deemed to have been approved. 14
  25. 25. TECHNICAL PAPER TO SUPPORT NPMP DECREEPort authorities will be expected to provide some justification for the proposed tariffchanges based on their financial impact on the port authority, requirements to recoverinvestment and operating costs of relevant services, competitiveness concerns, and theoutcome of any consultations port authorities have held with port stakeholders. TheMinistry of Transport will be entitled to conduct its own consultations with stakeholders if itbelieves this is necessary. The tariffs for all port infrastructure and services will bepublished for public notice, for example, on the Ministry’s and port authority websites.While the Shipping Law does not require Ministry approval of port business entity tariffs,this does not mean they would not be subjected to review and monitoring foranticompetitive behavior. In terms of terminal operations, port business entities control allactivities between and including the berth and gate. Port business entities in dominantpositions have the ability to leverage higher prices without the threat of losing business,thereby placing an undue cost burden on port users that is detrimental to tradecompetitiveness. There is also a further cost to society as prices not constrained bycompetition or regulation increases the costs to consumers and domestic production.Today, state-owned enterprises are not subjected to the provisions of Indonesia’scompetition law, while other port business entities are. The KPPU antitrust case precedentshave shown that it has regulatory jurisdiction over state-owned enterprise subsidiaries, butnot over state-owned enterprises themselves. This has the effect of encouraging state-owned enterprises to avoid creating subsidiary operating companies and directly managingand operating terminals themselves or, alternatively, to set standard prices for all terminalsunder their control. State-owned enterprises are also not prohibited from engaging inanticompetitive practices, such as predatory pricing and discriminatory behavior as well ascross-subsidization, in their efforts to eliminate competition. State-owned enterprises arealso not prohibited from engaging in anticompetitive practices, such as predatory pricingand discriminatory behavior as well as cross-subsidization, in their efforts to eliminatecompetition. Given the changing role of the Pelindos brought about by the new ShippingLaw, it is important to seek clarification from KPPU regarding the question of antitrustexemption. A continued exemption in itself will serve as a constraint to market entry ofpotential rivals and ultimately discourage needed port infrastructure investment. This initself will serve as a constraint to market entry of potential rivals and ultimately discourageneeded port infrastructure investment. Finally, we must bear in mind that state-ownedenterprises have profit maximization as their objective, with the Ministry of State-OwnedEnterprises establishing annual financial performance targets.2.8.3 Service AgreementsService agreements with individual customers are negotiated quite frequently and may befor either a fixed or indeterminate period of time, or linked to the shipment of specificconsignments. Because they usually involve price guarantees, they serve as de facto tariffs.Service agreements should be monitored to assure non-discriminatory behavior. Theyshould be filed with the Ministry of Transport under confidentiality rules established by theMinistry no more than 10 working days after they have been agreed with port users,together with supporting information which describes briefly the nature of the transactionand the reasons for entering into a service agreement rather than applying the tariff. If nocomments are received from the Ministry within 10 working days of the date of filing, theyare deemed to have been approved. Because they are highly confidential, serviceagreements with individual customers will not be published. Regulations should provide for 15
  26. 26. TECHNICAL PAPER TO SUPPORT NPMP DECREEthe confidentiality of agreements to be protected, unless disclosure is authorized by portbusiness entities.2.8.4 Rights of Explanation and ObjectionThe Ministry of Transport will be entitled to request an explanation from port authoritiesand port business entities for any proposed tariff changes (in the tariff or serviceagreements) which it wishes to query. At the request of the Ministry of Transport, changesto tariffs can be put on hold while this explanation is being given.The Ministry of Transport should have the right to object to an existing or proposed tariffonly on the grounds that it is anti-competitive or non-compliant with government policy. Atariff or service agreement can be considered to be anti-competitive when it fails to complywith Ministry of Transport guidelines (see Figure 2-1). These guidelines will also providegrounds for complaints about anti-competitive behavior which port users may refer to theMinistry of Transport. Port users making complaints about anti-competitive behavior will beexpected to produce factual evidence to support their complaints before the issue is takenany further.The Ministry of Transport’s right to object to a tariff item should only be exercised if thematter cannot be resolved through discussions with the port authorities and port businessentities. In this event, the following procedures will apply.  The Ministry of Transport should formally notify port authorities and port business entities of its objection, together with the reasons for it.  Port authorities and port business entities may respond to the objection with a statement of reasons which the Ministry of Transport is required to consider after which it must inform port authorities/port business entities whether or not it withdraws its objection.Figure 2-1 Guidelines for Anti-Competitive Pricing BehaviorAnti-competitive pricing behavior is normally defined in terms of the following criteria:Excessive tariffs. Average charges are high in relation to the cost of providing the service or for use of similarinfrastructure or services elsewhere and the premium cannot be justified by any unique feature in the coststructure of the port or terminal.Predatory pricing. Tariffs for particular infrastructure or services are below their appropriate marginal cost(long-term or short-term, according to the nature of the transaction).Price discrimination. Similar customers are charged different tariffs for the provision of similar services.However, this does not preclude volume discounts or the negotiation of individual service agreements for whichthere is economic justification.In situations where the Minister of Transport determines there may be anticompetitivebehavior, or if a complaint received may be valid, then the Ministry of Transport may referits own determination or complaint to Indonesia’s competition commission (KPPU), which inturn is obliged to take up the matter. To be able to do this, it is important that aninteragency Memorandum of Understanding be prepared that defines the process and rolesof either agency in considering possible antitrust behavior. Additionally, in furtherance ofpromoting competition, already a part of Indonesia national policy, the Ministry of Transportmust seek to incorporate a port sector state-owned enterprise exception to the exemptionaccorded to all state-owned enterprises in the antitrust legislation. 16
  27. 27. TECHNICAL PAPER TO SUPPORT NPMP DECREECircumstances will change over time, and the regulations should be flexible enough for tariffreview procedures to be modified by mutual agreement and formalized through aministerial decision without requiring legislative amendment.2.8.5 Policy  It is the duty of the Ministry of Transport to review the tariffs. The basic approach that the Ministry of Transport will adopt is that of “light-handed” regulation. On the part of port authority or PMU tariffs, it will object to proposed tariffs only to the extent that they are not reasonable relative to the cost of providing the service or infrastructure. In the case of port business entities, the Ministry will refer the proposed tariff to the Competition Commission if in the Ministry’s judgment it is not reasonable relative to the service or infrastructure cost or is anti-competitive or discriminatory.  The Ministry of Transport’s power of review is without prejudice to the freedom of port business entities to negotiate service agreements with individual customers.  The Ministry of Transport will issue regulations to clarify the procedure to be followed with tariff monitoring and review to ensure that a light-handed approach is followed which does not impose any undue burden on port authorities, port management units, or port business entities. The regulations will also specify the grounds for regarding the tariff or a service agreement as anti-competitive.2.9 Promoting Port Sector Competition2.9.1 Critical IssuesCompetition is generally regarded as the best way of achieving economic developmentbecause of the incentives it provides for all participants to satisfy customer needs in themost efficient way possible. Government intervention is only needed when competitiondoes not produce the desired outcome. The basic policy approach that many governmentsadopt and which is also the approach for Indonesia is “competition where possible,regulation when necessary”. This approach allows government to adopt a “hands-off”stance intervening only for one of three reasons: anticompetitive behavior, the existence ofexternalities (such as traffic congestion or pollution which are not automatically taken intoaccount in commercial decision-making), and a failure to provide customers with sufficientinformation.Indonesia’s port sector is not yet highly competitive, meaning that shippers are left with veryfew options relative to their hinterland markets. The use of more distant ports imposessignificant transaction costs on port users, thus reducing their effective choice. Currently,terminals serving specific hinterlands are now managed by the same state-owned enterprisethrough subsidiaries. This enables the state-owned enterprises to take decisions that maybe favorable to their overall business, but which could be to Indonesia’s disadvantage. Assole providers of port infrastructure and services, the potential for abuse of monopolypower exists even if it is never exercised. These factors create a strong case for the Ministryof Transport to have a role in advising the government on ways in which competition mightbe increased, and to have a role in controlling anti-competitive behavior should it arise.The layout and scale of cargo volumes in Indonesia’s largest ports suggest that competitioncould be introduced to effect inter-terminal competition. Hence, as part of its master planreview process, the Ministry of Transport will consider strategies for introducing 17
  28. 28. TECHNICAL PAPER TO SUPPORT NPMP DECREEcompetition. Additionally, in order to avoid monopoly or oligopoly effects of verticalintegration of port services, and the opportunities for cross subsidization, the Ministry mayprohibit port business entities providing certain services from also providing other services.For example, terminal operators may be prohibited from also offering tug assist services.This policy will prevent operators from bundling port services and thus expand theopportunities for inducing competition.The Ministry of Transport will also endeavor to simplify licensing procedures for servicescurrently requiring licenses while assuring adequate insurance against liability. This policy isintended to ease market entry requirements while simultaneously assuring only qualifiedlicense holders can provide the service. This will serve to establish a market for certainservices which will encourage local entrepreneurship and the development of small andmedium sized enterprises.Where the market fails to ensure competition, Indonesia must have a framework in placethat can anticipate the potential for abuse of monopoly power in the future as commercialrelationships may evolve in unforeseen ways. Anti-competitive behaviour can assume avariety of forms (see Figure 2-2).2.9.2 Complaints ProcedureDue to the imbalance in market power between the port operator, service providers andport users, it is important that an effective channel exists for reporting and resolvingcomplaints and disputes relative to anticompetitive behavior. Such complaints refer only toissues related to anticompetitive behavior. For complaints not related to anticompetitiveFigure 2-2 Criteria for Assessing Anti-Competitive Behavior  Entry barriers (Access discrimination). Potential port users are deliberately excluded from access to particular infrastructure or services, at a time when the port business entity is physically and legally capable of supplying them, and would not lose money by doing so. This includes failure to invest when the port is approaching full capacity.  Service bundling. Port users are required to purchase services they do not want, or could buy from a competitor, in order to obtain access to infrastructure or services for which the supply is more restricted.  Exclusive dealing. Port users – and the port operator’s own suppliers - are not allowed to deal with the port operator’s competitors, and are threatened with loss of their existing business if they do so.  Performance standards. The port operator fails to provide an acceptable quality of service, and/or consistently fails to meet its conditions of contract with port users or government.behavior, port authorities are better positioned to receive, respond, and seek remedies tocomplaints relative to non-competitive issues.Best practice encourages the parties to negotiate a commercially-acceptable solution. Theregulator’s first response should always be to direct the parties to seek a negotiatedoutcome, rather than have a solution imposed “from above” by the regulator. Only iftheparties are unable to achieve a settlement between them should the regulator becomeinvolved. However, even with the involvement of the regulator, the initial approach will be 18
  29. 29. TECHNICAL PAPER TO SUPPORT NPMP DECREEto seek to reach an amicable settlement between the parties through independent non-binding mediation. Only once both direct negotiations and mediation have failed will theMinister of Transport refer the matter to the KPPU. The following general guidelines shouldapply to complaint procedures.First, all incoming complaints should be formally recorded and acknowledged. Complaintsshould be made in a prescribed format and be accompanied by supporting documentation.After a review of the complaint a decision should be made on whether the complaint fallswithin the Ministry of Transport’s jurisdiction. Complaints about day-to-day operationalmatters, for example, should be automatically referred back to the port authorities.Frivolous or vexatious complaints should also not be entertained. The organization againstwhich the complaint has been made should then be given the right to respond, usuallywithin a pre-determined time period which reflects the nature of the complaint. At thispoint, the Ministry of Transport is entitled to ask either party to the dispute for furtherinformation if this seems appropriate.After reviewing this “first round” of information, the Minister of Transport may ask theparties involved to attempt to resolve the dispute themselves and it will generally do so if itbelieves a commercially-negotiated outcome can be achieved. In fact, before lodging acomplaint, complainants should make every effort to solve a dispute through negotiations asthey are likely to be required to present evidence to the Ministry that they attempted toresolve matters in good faith. Where the Ministry directs the parties to attempt to resolvethe dispute themselves, it should be entitled if it wishes to offer informal suggestions onhow to proceed. A limited period of time should be allowed for the parties to resolve thedispute, at the end of which the status of the complaint – resolved, unresolved, orpartially/conditionally resolved - should be recorded by the Ministry.2.9.3 Policy  The Ministry of Transport in partnership with the KPPU has the overall responsibility to promote competition within the port sector. It is cognizant of the fact that the ports sector is highly concentrated and characterized by monopolies. Hence, it will remain vigilant to prevent anti competitive behavior and abuses of monopoly power.  The Ministry of Transport will promote competition by executing its planning functions and participating in the debate – by conducting its own independent analysis - of ways in which competition can be increased, especially with regard to the planned new port developments or expansion of existing ports.  The Ministry of Transport will develop the capacity to respond to alleged anti- competitive behavior by introducing a complaints and dispute resolution procedure in regulations. Where applicable, the approach to be followed will be similar to the procedure used in resolving disputes with regard to port tariffs.2.10 Enhance Labor Competitiveness2.10.1 Critical IssuesWhile all workers should be assured of a safe and rewarding work environment, there is anexpectation that the work force will also be competitive relative to global standards. Portauthority and PMU employment systems must distinguish themselves in terms ofemployment conditions and work environments in order to effectively compete for highly 19
  30. 30. TECHNICAL PAPER TO SUPPORT NPMP DECREEqualified workers with other sectors. Port authorities and PMUs must offer a nurturingenvironment for entry level workers, both men and women, that translates to careeradvances facilitated by training and development and experience. At the same time, therehas to be a concerted effort in collaboration with vocational and higher educationinstitutions to promote the port sector as a desirable career option, for both men andwomen, and to assert a symbiotic relationship in continuing education opportunities for portsector workers.While capacity development is recognized as important to port performance, we must alsorecognize the importance of work practices to a port’s competitiveness. Today, terminaloperators are compelled to hire workers from labor cooperatives; because of lowproductivity and capability concerns, workers from labor cooperatives are retained whileterminal operators simultaneously deploy their own workers, increasing the cost of doingbusiness in the port. Labor cooperatives must demonstrate improved capacity to workskillfully and productively, while availing themselves of training programs designed toimprove their capabilities and performance. At the same time, as skill levels are increased,work practices must also reflect global standards; the size of the gangs offered bycooperatives for container handling, for example, are substantially larger than the norm forcontainer handling. Additionally, while most modernized port systems offer workers on a24/7 basis, labor cooperatives in some cases are not willing to deploy late-shift gangs.Terminal operators are thus not able to serve vessels during late-shift hours as they are notpermitted to use workers without hiring cooperatives.2.10.2 Policy  The Ministry of Transport, in close consultation with training centers, port business entities, port authorities, and labor cooperatives, will identify port sector training and education requirements for the Ministry (including DGST), port authorities, PMUs, labor cooperatives, and port business entities and and will develop a strategy for addressing port sector training and education needs. Training requirements and strategy will be periodically revised to reflect changing demands.  The Ministry of Transport will engage in memorandums of understanding with training centers, vocational institutions, and higher education institutions to promote port sector careers and to identify training and development requirements to improve labor productivity and assure respective curriculums are responsive to port sector needs, including those of the Ministry of Transport, port authorities and PMUs, port business entities, and labor cooperatives.  The Ministry of Transport will engage in a dialogue with labor cooperatives to formulate incentives for increasing productivity, expand training programs, improve work practices, and to identify strategies for enhancing competition among the cooperatives providing port workers.  The Ministry will promote the recruitment and retention of women into the port sector workforce and women’s participation in vocational and higher educational institutions. 20
  31. 31. TECHNICAL PAPER TO SUPPORT NPMP DECREE2.11 Supporting Effective Port Safety Regulation2.11.1 Critical IssuesEffective safety regulation in Indonesia’s ports is a shared responsibility of the nationalgovernment, port authorities, and port business entities. This requires the Ministry toestablish a policy for safe operations with the port authorities responsible for the executionof this policy. Port business entities in turn are responsible for introducing safetymanagement systems as part of their operational functions.The role of port authorities in landside safety and environmental management must beclarified in view of their status as new organizations and the Ministry’s oversight role inensuring that ports are managed in a safe and environmentally-responsible manner.Independent safety oversight by the Ministry of Transport can be undertaken by developinga port safety and security framework that is agreed between the Ministry and the portauthorities by way of a Port Safety Code or similar standard. In practice, it will be a formalagreement between the Ministry of Transport and the port authorities that sets out portsafety operating requirements and corresponding performance measures.2.11.2 Policy  The Ministry of Transport will enhance implementation of regulations which entrust port authorities and harbor master with effective powers to oversee safety and security based on international guidelines and standards.  The recent reforms creating the port authorities require that there be independent oversight of port safety. To this end, the Ministry of Transport will develop a port safety framework setting out the obligations of port authorities in respect of compliance with port safety regulations.2.12 Supporting Effective Environmental Regulation2.12.1 Critical IssuesThere are many common environmental concerns that ports face. These include:  Handling, storage, and movement of International Maritime Dangerous Goods Code (IMDG) cargoes;  Waste generation from vehicle and maintenance activities and proper disposal of such wastes;  Bunker facilities, pipelines and other above- or underground storage tanks for fuels;  Potential for oil, fuel and hazardous material spills and the need for spill prevention planning and emergency-response measures;  Protection of the sea and atmosphere from releases into the environment, either from spills, directed discharges, or non-point source pollution;  Air pollution from ground vehicle and vessel exhaust fume emissions;  Wastewater discharges from cleaning operations and ballast water;  Solid waste (sewerage and garbage) disposal; and  Ballast water management.Hence, national authorities are responsible for establishing internationally acceptableguidelines in respect to the port and marine environment. The Ministry of Transport isresponsible for developing and applying regulations while port authorities are responsible 21
  32. 32. TECHNICAL PAPER TO SUPPORT NPMP DECREEfor assuring compliance by port business entities and users. An ISO 14001 EnvironmentalManagement System is required to help the port self-police its environmental requirementsand audit its own facilities, as well as develop plans to reduce pollution and commit tocontinuous improvement. In turn, the ISO 14001 Environmental Management System shouldbe part of an integrated Environmental, Health and Safety Management System.2.12.2 Policy  Effective environmental protection must be ensured through a port environmental protection code that will be developed by the Ministry of Transport and implemented by port authorities which sets forth:  An Indonesian standard and best practice guidelines for environmental protection in the ports;  A framework for an environmental management system to be developed and implemented by the Ministry of Transport; and  Provides for periodic independent audits in addition to the oversight role to be undertaken by the Ministry.  Harbor master will be entrusted with specific powers to manage and control pollution in the ports.  The Ministry of Transport will assume its full responsibilities under the Emergency Management System and engage partners in the maritime field to ensure that there is a functioning system of emergency response in the port sector. 22
  33. 33. TECHNICAL PAPER TO SUPPORT NPMP DECREEChapter 3. Analysis of Port Traffic and Current PerformanceIn this chapter we present information collected on traffic for ports within the Indonesianport system, and trends in foreign and domestic traffic volumes by type of cargo andcommodity/commodity group. Data on foreign trade (imports and exports) and domesticshipping (loadings and unloading) are presented for the following cargo types andcommodity/commodity groups:  General cargo  Container  Dry bulk o Cement; o Coal; o Iron ore; o Fertilizer; o Grain; o Other dry bulk.  Liquid bulk o Petroleum & products; o Crude palm oil (CPO); o Other liquid bulk.  Total traffic3.1 Approach and Data SourcesA complete profile of the traffic handled at Indonesian ports is an important element toprepare traffic forecasts, identify necessary future port capacity additions and estimateinvestment. Information sources include data maintained by the DGST, by individualPelindos, and from other recent studies of the Indonesian port sector. The informationobtained from each of these sources is described in the sections below.3.1.1 DGST Shipping Data SetsDGST compiles from data provided by the shipping companies that report information onvessel calls at Indonesian ports. Separate data sets are maintained for foreign trade fordomestic shipping. The foreign data set obtained for 2009 includes the followinginformation:  Name of shipping company;  Name of vessel;  Deadweight, gross tonnage and horsepower of vessel;  Name and location of shipper (exporter or importer);  Direction of trade (import or export);  Foreign port of origin or destination;  Indonesian port of origin or destination;  Commodity and commodity group;  Tons or TEU loaded or unloaded;  Crew;  Type of vessel (tramper or liner). 23

×