Pushing To Enter The World Supply Chain, Jokowi Asks Erick Thohir To Find PT Pelindo Partners With International Standards

Indonesian President Joko Widodo (Jokowi) together with SOE Minister Erick Thohir. (Photo: Instagram @erickthohir)

JAKARTA - President Joko Widodo (Jokowi) asked PT Pelabuhan Indonesia (Persero) to be able to contribute to the global supply chain. Because the government has officially merged Pelindo I to IV, so its performance must improve.

Therefore, Jokowi asked the Ministry of SOEs as a shareholder to look for a Pelindo business partner (partner) who has international networking or networks. The goal is to achieve this target. That way, the company's business can be connected with other countries in the world.

"I also ask for partners right now. Look for partners who have networking, who have extensive networks. Until later they are connected to other countries. What does that mean? Our products, our goods can roam everywhere, enter the supply chain Globally, the goal is to go there," said Jokowi at the inauguration of the Merger of Pelindo and the Wae Kelambu Multifunction Terminal, quoted from the Setpres YouTube, Thursday, October 14.

Jokowi said that the Pelindo merger would reduce logistics costs. Because, currently, logistics costs in Indonesia are still high or at the level of 23 percent when compared to other countries which are in the range of 12 percent.

"We know that our country's logistics costs compared to our neighboring countries are still far behind, we are lagging behind. Their logistics costs are only 12 percent or less, we are still 23 percent. This means that there is something inefficient in our country," he said.

The former governor of DKI Jakarta said the Ministry of State-Owned Enterprises (BUMN) as a shareholder has also set a target for container terminals belonging to the Pelindo Group to be included in the 8 largest terminals in the world.

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As the main operator of a number of ports in Indonesia, the presence of four companies in one new holding is also considered capable of providing integrated and standardized services. Where, the service at one port will be the same as the other port.

Jokowi said that the merger of the four state-owned companies could improve the quality of logistics services in the country. The existence of the holding is also able to reduce logistics costs, which are currently recorded at the level of 23.5 percent of Gross Domestic Product (GDP).

As is known, Indonesia's logistics costs, which are at the level of 23.5 percent, are different from Malaysia, which only reaches 13 percent of the GDP of the local country. Meanwhile, the amount of logistics costs greatly affects the ease of doing business index which has been the concern of potential investors to invest in a country.