President to sack officials responsible for Tanjung Priok delays

President to sack officials responsible for Tanjung Priok delays
The Kalibaru container terminal is currently under construction

According to local media reports, Indonesian President Joko Widodo has threatened to dismiss officials, including cabinet ministers, if they fail to end the protracted cargo processing time at Jakarta’s Tanjung Priok Port.

Widodo said that he was well aware of the legendary delays at Indonesia’s largest and busiest the port which handles two-thirds of Indonesia’s international trade, from his experience of running a furniture export business, and threatened to fire any officials responsible for the problems which cost the country Rp780 trillion (US$58billion).

“The process takes too long because the people handling it don’t want to move fast,” he told reporters. “Dwell time is an average of 5.5 days – the longest in Asia, while some items take up to a month to clear customs and excise.”

The President said that he will not hesitate to fire such officials. “If they have to be dismissed then they will be [and] if any director general or even minister does not give a fast service, then I will do what I have said,” he told local media on June 18.

The president had visited Tanjung Priok for a “detailed check on several activities” and to ask port officials “to solve the problems causing long dwell times and inefficiency at the port.

Widodo said that Tanjung Priok port officials had glossed over the problems and dared not answer his question about why long delays had persisted and that the situation had provoked him to find the answer by himself, and in his own way.

The president had previously asked officials to reduce container loading and unloading times to the levels achieved in neighbouring countries. “The average dwell time at Tanjung Priok should be brought down to 4.7 days if Indonesia was to be competitive with Singapore and Malaysia,” he said.

“Don’t say everything’s fine. The reality is that [Indonesia] is lagging far behind. So who? Customs or trade? Who should I be speaking to?” he said, repeating the question several times. There was no response from any of the officials.

In July this year (2015) container handling will be transferred to Phase 1 of the new Kalibaru container port seven kilometres to the west of Tanjung Priok. Currently under construction, Kalibaru is an expansion of Tanjung Priok and the first terminal will have a capacity of 1.5m teu.

PT Pelabuhan Indonesia II (Pelindo II), the Indonesia Port Corporation (IPC), has appointed Japanese conglomerate Mitsui Co. to jointly operate the first container terminal at Kalibaru. IPC will own a 51% percent stake in the joint venture and Mitsui will hold the remaining 49%.

After the first terminal is completed, Mitsui will build two other container terminals with an additional capacity of 4.5m teu with completion currently scheduled for 2018.