Shipbuilding Industry Needs Financial Support

Industry Minister Agus Gumiwang Kartasasmita visits the KMP New Rose wheelhouse in Makassar, South Sulawesi, Monday, February 10. (Photo: Ministry of Industry)

JAKARTA - The shipbuilding industry in Indonesia is considered to have high competitiveness because it is able to produce quality products. This is inseparable from the ability of human resources and the use of modern technology.

"The development of the shipyard industry is in line with the government's determination to realize the sea highway, so it is hoped that a smooth flow of logistics is more efficient, especially for the industrial sector. Efficiently, it can further reduce logistics costs, "said Minister of Industry Agus Gumiwang Kartasasmita during a working visit at the PT. Afta Tehnik Mandiri, Makassar, South Sulawesi, Monday 10 February.

The Minister of Industry revealed that the human resources of the shipyard industry in Indonesia are already competitive with technicians or experts from abroad. For example, this ability was demonstrated by PT Afta Tehnik Mandiri employees who completed the construction of the 1,395 GT "KMP New Rose" Ro-Ro Cargo Ferry.

"Of course we are very proud of this achievement, and we will continue to encourage its competence. In fact, they can make the production costs much cheaper than similar types of ships from imports, "he explained.

The completion of the KMP New Rose took about 1.5 years and involved 40 workers. The KMP New Rose was designed and built to fulfill a need that did not exist in the company's previously owned fleet.

Agus added, his party, together with related stakeholders, are always proactive to support the progress of the shipbuilding industry in the country by issuing strategic programs and policies.

"For example, what needs to get attention from the government, one of which is assistance regarding the funding of the production process," he said.

This is because apart from being labor intensive and technology intensive, the shipbuilding industry is also capital intensive. "In building ships, they require a very large amount of money, while the project cannot be used as collateral by the bank. In accordance with the mandate of the Industry Law, the government needs to build the financing institution itself, "he explained.

In addition, other policies that will continue to be encouraged for the advancement of the shipbuilding industry are the provision of fiscal incentives. "This policy is considered important because it can give the shipyard industry flexibility in increasing its capabilities and competitiveness," he added.

The Ministry of Industry noted that the national shipping industry has made some progress, including increasing the number of shipyards to more than 250 companies with a production capacity of around 1 million DWT per year for new buildings and up to 12 million DWT per year for ship repairs.

"In the future, we hope that the production capacity for new buildings and ship repairs can continue to be increased," explained the Minister of Industry.

Moreover, the shipping industry or shipbuilding is a strategic sector and has a vital role in the wheels of the national economy. In addition, in order to realize Indonesia's vision as a world maritime axis.

"Therefore, the government continues to encourage the growth of the shipbuilding industry in the country so that it can meet the needs of the domestic market, even be able to fill the export market," said Agus.

Therefore, a conducive investment climate is an absolute requirement that becomes the government's attention so that the operational sustainability and productivity of the shipping industry sector can be more optimal.

Maritime Sector Strength

Furthermore, the Minister of Industry also visited the shipyard of PT Industri Kapal Indonesia (Persero) in Makassar. This activity is intended to hear directly from the national shipbuilding industry players regarding the needs or challenges in running their business.

"Moreover, the initial establishment of PT IKI was through the Ministry of Industry. So, it is a responsibility for us to continue to spur this sector so that it can grow and develop, "he said. This is to implement the government's desire to make Indonesia a country that has strength in the maritime sector.

According to the Minister of Industry, there are many things that need to be fulfilled and addressed so that these targets can be achieved, including for the development of the shipbuilding industry in the country so that it can be more independent. "This is definitely the focus of the government," he said.

In order to realize the independence of its industrial sector, in the short and medium term, the Ministry of Industry continues to spur the production capacity of the shipyard industry. This effort is expected to support the optimization of the use of domestic products and improve the national trade balance by substituting imported products.

"Then, what is also a priority for the Ministry of Industry is to prepare competent industrial human resources. In this case, the Ministry of Industry will increase cooperation related to competency training in the field of welding or welding, "he explained.

The Minister of Industry said that his party is very open to collaborative steps, including with industry players. "We will also facilitate teachers and students who want to improve their competence in the industrial sector. Therefore, we will immediately follow up, "he added.

In fact, Agus said in a limited cabinet meeting some time ago, President Joko Widodo gave an example of the existence of ship construction technology for flat plates which allows the construction of fishing boats that are guaranteed to be safe, but at a lower price. This is one of the things that the government will focus on in applying research results connected to the industrial world.

"In the meeting, the President conveyed that the Ministry of Maritime Affairs and Fisheries prioritizes the purchase of fishing vessels, the type of which is based on the research results of the Flat Plate, around 50-60 tonnages. I think PT IKI already understands the advantages of building a flat plate-based fishing shipping industry, including those related to production and maintenance costs, "he said.

In addition, PT ASDP Indonesia Ferry (Persero) this year budgeted to buy 11 ships. In fact, in five years, ASDP needs as many as 54 ships.

"This is a potential and a challenge for our shipbuilding industry. This must be utilized as much as possible for domestic interests, especially to supply the needs of ships in Indonesia, "he explained.