The International Transport Workers’ Federation (ITF) has urged the Indonesian president to intervene over the extension of the concession for Jakarta International Container Terminal (JICT),
With the current deal due to expire in 2019, the Indonesia Port Company (IPC) has granted a contract extension to Hong Kong-based terminal operator, Hutchison Port Holdings (HPH).
However, the ITF-affiliated JICT Union claims that the that the extension process has been rushed, has lacked transparency and has not been conducted through an open tender mechanism.
It believes that a concession extension on current terms does not make sense financially and is not in the national economic interest. Furthermore, it is worried about the intimidation of workers and potential job losses, alleging that process has not taken the impact on employees into account.
The JICT Union also claims that the IPC has ignored its attempts to discuss its concerns and seek a transparent process for more than one year.
In a letter to president Joko Widodo sent on 16 July, ITF general secretary Steve Cotton said: “We seek your urgent intervention to cancel the extension in the light of the issues that have been raised by the union.
“It, and the ITF, are requesting that you and your government act urgently to cancel the extension of the concession granted by the IPC, and to put in place a transparent process to deal with the matter,” he added. “The ITF also strongly supports the JICT Union’s argument that JICT should be owned and managed nationally.”
ITF Asia Pacific chair Hanafi Rustandi commented that the extension violated national law, which assigns authority for the granting of concessions to the transport ministry. He also questioned why the management of a profitable terminal should be handed over to a foreign company and warned that this would threaten local opportunities.
Despite the local unrest, the Indonesian government is currently aiming to raise US$7bn of foreign investment to improve its ports, which are beset by a lack of capacity.
Shipping lines currently offer no direct mainline services from the South East Asian nation to either Europe or the US due to capacity shortages.
The country’s ports also lack the necessary depth to handle the largest ships with its largest port, Tanjung Priok, hampered by a maximum draught of 11.5 m and a maximum vessel length of 250 m.