JAKARTA: Ministry of Transportation will prioritize two main commodities regulation in beyond cabotage program as the follow up of cabotage principle practice.
Ministry’s Marine Traffic and Transport Director of Marine Transportation Directorate General, Adolf R. Tambunan said that the two commodities are coal and crude palm oil (CPO).
"We have started discussion with associates about cargo identification then we'll talk with the relevant agencies," he said, yesterday.
Beyond cabotage program is the follow up of cabotage principle that requires domestic sea cargo to be transported with Indonesian-flagged vessels which is currently dominated by foreign ships.
The program also designed domestic transportation obligation (DTO) application in which the government requires a minimum of 30% CPO export, coal and gas freight flagged to use Indonesia-flagged vessels as the follow up of the successful implementation of cabotage principle since 2005.
Adolf explained the export transportation using Indonesian –flagged vessels particularly coal and CPO was aimed to enhance national shipping competitiveness.
According to him, national import and export freight is still dominated by foreign vessels up to 90%, while Indonesia vessels only own 9% -10% market share.
"This is our lost potential income, our trade surplus was returned to pay sea freight services," he said. (T07/msw)