"We want to be efficient. We want Indonesia to be able to compete (with other nations),” Pandjaitan said in Batam, Riau Islands province on Thursday.
He noted that logistics costs in Indonesia are not relatively efficient compared to neighboring countries. Therefore, the government has formulated the Batam Logistics Ecosystem platform as part of the National Logistics Ecosystem (NLE), he said.
Finance Minister Sri Mulyani Indrawati expressed the hope that the program will be able to improve Batam’s competitive edge.
Batam’s economic growth in the past five years was lower than the national average, she noted. In fact, the city has high potential to record high economic growth, she added.
"BLE is aimed at improving business certainty and attractiveness in Batam," she remarked.
The government will also apply NLE in all ports across Indonesia, she said.
"We hope this is part of economic recovery. We see economic activities have declined in the wake of the pandemic, so we need to make improvements,” she added.
The government chose Batam for the logistics system because the city connects the state with neighboring countries, she said.
Pandjaitan said the government has developed the integrated ecosystem to streamline logistics to allow the nation to compete globally.
Logistics costs in Indonesia have reached 23.5 percent of the gross domestic product (GDP), he noted. Meanwhile, in Malaysia, the logistics costs stand at just about 13 percent of the GDP.
Pandjaitan noted that with a difference of some 10 percent, investors will reconsider entering and investing in Indonesia. To this end, the government is making unwavering efforts to reduce logistics costs, he added.
Related news: Eight major seaports to be included in National Logistic Ecosystem
Related news: Kayu Agung-Palembang Toll Road to significantly lower logistics costs
Related news: Patimban Port development to slash national logistics costs: Minister
Related news: Manado-Bitung toll road will reduce logistics costs: President Jokowi