The Indonesian Forwarders Association (INFA) has reported that many of its members in the DKI Jakarta province have closed their business as a consequence of their inability to compete with multinational forwarders operating in the city. INFA said the number of forwarders has been reduced from 1,400 in 2005 to just 780forwarders who are active today.

The chairman of INFA for the Jakarta chapter, Syukri Siregar said at the association’s recent workshop that local forwarders have lost their grip as a result of global forwarders taking over customs clearance business, which is the core business of many local forwarders. "If all main stream and down stream activities are taken over by multinational companies, local forwarders will cease operations. It is indeed jeopardising the domestic logistics industry," Siregar said, adding that the association regrets the government’s ignorance of the issue.

INFA has suggested that the government should increase the guarantee from Rp150 million to Rp2 billion for multinational forwarders, which are active in customs clearance. "The problem is that the government is not responding with reasons to attract more investment into the country," Siregar said. – Siktus Harson