Illegal Import Products Rise In E-Commerce, Logistics Entrepreneurs Give 5 Recommendations To Coordinating Minister For SMEs

JAKARTA - Minister of Cooperatives and SMEs (Menkop UKM) Teten Masduki received an audience from the Logistic E-Commerce Entrepreneurs Association (APLE) and the Indonesian Digital Economy Logistics Association (ALDEI) regarding the rise of imported products suspected of being illegal to enter the local market in Indonesia, on Wednesday, September 20.

Chairman of the APLE Association Sonny Harsono said that currently imported goods are found which are very cheaply traded on local marketplace platforms or in socio-commerce, which can be ascertained that this item is not a cross-border item.

"From the logistics costs alone, it is above the minimum cost of shipping by air freight (air), it is certain that goods sold at low prices are imported in a way that cannot be accounted for / unofficial / under-invoiting. Not to mention that 13 products have been banned from being traded cross-border but are instead found on the local market platform at a much cheaper price," he said in his official statement, quoted Thursday, September 21.

Sonny added that the weak supervision and absence of a control system from trade and fiscal authorities is one of the factors for the large number of illegal imported products entering the domestic market. The massive sales of imported goods carried out online can kill domestic products.

"Many goods enter illegally from the sea route with a fairly cheap shipping cost ranging from 500 US dollars per 1 container or equivalent to 0.001 US dollars per item. In fact, if using the official route, the shipping fee will be up to 6-8 US dollars per kilogram," he added.

In line with Sonny, Head of ALDEI Imam S. said that allegations of illegal imports could kill domestic SMEs. This can be seen from the many costs that are cut unofficially so that prices can be much cheaper.

"Of course, every import item must have a history of licensing or import licensing, the second is licensing to sell imports and documentation must be clear," he said.

In terms of logistics, Imam added, currently the competition of logistics companies in the country is quite heavy, in which the logistics sector is 70 percent controlled by foreigners, and the rest is 30 percent from local.

"The current condition of logistics competition can be said to have reached the predatory pricing stage and unfair competition, where service selection is no longer determined by buyers and sellers, but is determined by the e-commerce platform," he said.

"This also has an impact on the status of courier workers who were initially permanent employees, currently many are only partners. This affects their income," he continued.

On this occasion, the APLE and ALDEI Association gave five recommendations regarding the alleged number of illegal imported products.

The first recommendation is that the government must jointly monitor every e-commerce platform that sells cheap goods and check whether the goods sold are in accordance with customs documents or not.

For the second recommendation, which is to encourage e-commerce platforms to require imported goods accompanied by import permit documents before being sold.

Then, the third recommendation is that cross-border products from foreign producers to domestic consumers below the price of 100 US dollars are prohibited from entering Indonesia.

Next, the fourth recommendation is to require domestic and foreign e-commerce platforms to prioritize and not discriminate over Indonesian products.

The fifth or last recommendation is that e-commerce platform providers are prohibited from selling their own products, except for these products, the results of MSME aggregation and proven by NIB.