Logistics companies and ship owners in Indonesia are urging state-owned port operator PT Pelabuhan Indonesia II (Pelindo II) to switch its rates from U.S. dollars to the local currency, saying that with the rupiah’s fluctuations, the current arrangement is hurting their business.
The Indonesian Logistics Association (ALI) issued the call as it claimed that basing port rates to the U.S. dollar impacts on their cost competitiveness, as the rupiah continues to depreciate against the greenback, reported The Jakarta Post.
The rupiah has reportedly declined 5.3 percent since March, the worst performer among 24 emerging market currencies tracked by Bloomberg, added the report.
The ALI argued that Indonesia is the only country in the Association of Southeast Asian Nations not to use its national currency to determine port rates.
The Indonesian Ship Owners Association is supporting the ALI’s cause, noting that other countries including India and Myanmar are already using their own currencies in all types of port transactions.
Coordinating Economic Minister Chairul Tanjung, during a visit to the Tanjung Priok Port earlier, said Pelindo II’s use of U.S. dollars in transactions with customers was unlawful, since the 2011 Currency Law stipulates that all domestic transactions should be in rupiah.
Chairul told local media that Pelindo II has three months to switch the currency to rupiah.
Over in Malaysia, Westports Malaysia Sdn Bhd, the biggest terminal operator at Port Klang, the country’s premier ocean gateway, has been allowed to extend its port concession for another 30 years.
The Port Klang Authority recently granted the concession extension, which will run from September 1, 2024 to August 31, 2054.
One of the main conditions for the extension was the completion of land reclamation works for the construction of new container terminals, which has been achieved by Westports.
Meanwhile, Northport, the second terminal operator at Port Klang, has appointed Rubani Dikon as its new CEO. Rubani assumes his new role on September 1, reported Bernama, Malaysia’s national news agency.
Rubani is currently the company’s head of finance and corporate secretary. He will replace Abi Sofian Abdul Hamid, who in turn will take over as group managing director of NCB Holdings, the mother company of Northport. Hamid is taking the reins from Datuk Abdul Samad Mohamed, who is due to retire.
Photo: aenertia
