Govt to lower bar for small traders to import steel, textiles

Posted on 02 October 2017

Source: The Jakarta Post

The government is looking to complete its new, shortened list of prohibited and restricted goods next month, allowing more goods to be imported by small and medium traders with simpler import permits in a bid to reduce illegal imports.

The Trade Ministry’s import director Veri Anggrijono said the ministry had come up with two regulations to aid imports of iron, steel and their derivatives as well as textiles and textile products for small and medium enterprises (SMEs). The remaining list will be simplified by this month.

“Previously, we aimed to simplify [import] procedures for around 30 goods but some goods of a dangerous nature, like waste and others, must still be checked at the borders [customs clearance]. So, the simplification can only be done for less than 30 goods,” he told The Jakarta Post on Saturday.

Under the new steel import regulation, the government will ease procedures for SMEs to import less than 1 ton of the commodity and will change goods supervision to a post-border method, in which physical checks of goods will be done at the importers’ warehouse after custom clearance. In the past, the physical check was conducted before the clearance.

The simpler procedures for iron and steel will apply only for SMEs that import goods under 1 ton. For those above 1 ton, inspections in the country of origin must be carried out by the government appointed surveyors and must be checked using the post-border method.

Iron and Steel Industry Association (IISA) executive director Hidayat Triseputro said the association had requested the Trade Ministry to disseminate the details of the changes to prevent confusion with the new mechanism among businesspeople.

“If the detailed mechanisms are still obscure, the association members worry that this could lead to higher costs. Does the post-border verification take a long time and does it potentially disrupt production processes?” he wrote in a text message on Friday.

For textiles and textile products, SMEs holding Common Importers Identification Numbers (API-U) can now import the commodities, unlike previously when only Producers’ Importers Identification Numbers (API-P) holders could import such goods like fabrics and other raw materials for making garments.

Import simplification is part of the 15th economic policy package to cut logistic costs and improve businesses’ access to raw materials. It targets to reduce the number of prohibited and restricted goods from the current 49 percent of 10,826 HS (harmonized system) codes listed in the Custom Tariff Book (BTKI), to only 19 percent. ASEAN countries have 18 percent of codes on a prohibited list on average.

Other goods to enjoy simpler import procedures were mostly raw materials, Veri added, refusing to disclose the details.

Indonesia Pharmaceutical Materials Management Club deputy chairman Vincent Harijanto suggested the government place a Food and Drug Monitoring Agency (BPOM) representative in every customs office at every port to expedite physical checks of goods.

“The process to get an import permit from BPOM has been good but at the customs office, our friends complain that customs officials sometimes make it hard for the goods to pass through because they don’t have knowledge of drug material specifications,” he said.

The association, he continued, had voiced the message for a long time to no avail, until now. The customs offices, operating under the Finance Ministry, has its own institutional ego, which means it resists intervention by other bodies, according to Vincent.




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