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(11/8/2004) A long-awaited and much-overdue shake up of Indonesia's shipping sector is expected to commence when the current draft of a Presidential Instruction of on Shipping is finalized and signed. Those instructions – the result of input by no less than 13 ministers and governors – are expected to help revitalize the morbid national shipping sector.
Among the measures reportedly included in the new Instructions are Indonesia's ratification of a number of international maritime treaties, revisions in mortgage and ship arrest rules in order to make international financing more accessible to Indonesian shipping operators, and strict enforcement of cabotage rules to encourage the development of the country's merchant maritime fleet.
While we join the rest of the Nation in a collective sigh of relief that attention is finally being paid in a country comprised of more than 17,000 islands to the need to encourage inter-island shipping, we have concerns that important opportunities for developing cruise passenger shipping are being missed under the new rules.
Have We Forgotten Something?
While tighter regulatory control of the inter-island carriage of freight to encourage national shipping operators is needed for e development of a national merchant fleet, we wonder what thought, if any, has been given to fostering passenger cruise tourism in Indonesia?
Indonesia should be one of the world's premier cruise destinations. Its islands, rich in culture and natural attractions, are stretched along the equator enjoying good weather year round. Yet, with the exception of a small fleet of traditional phinisi sailing boats fitted out to carry paying passengers, Indonesia has no International cruise shipping presence. Meanwhile, immediately to the north, Singapore is home to Star Cruise - one of the leading cruise shipping companies and to the south, Australian cruising appears to be booming.
Indonesia has all the natural attractions to draw cruise ships – outstanding island destinations, rich cultures, by and large friendly welcoming local communities, and good weather. Yet, despite these natural advantages, and with the exception of the occasional crusie ship which drops anchor jusst off our shores, Indonesia is largely absent from the itineraries of international cruise ships.
The reasons why an Indonesian cruise industry has failed to take root are both many and complex and certainly worthy of a more detailed discussion than this forum permits. Our concern is that current changes in the rules for national shipping will have little or no effect on the long-dormant national cruise shipping sector.
Issues Worth Considering
From our perspective, here are a few of the issues holding back Indonesian cruising:
• The Immense Size of the Nation. Indonesia's territory is equal in breadth to the space occupied by the entire continental United States. Because of its vast size, this is a nation where many of the major areas of interest to cruise ships are located several days sailing from national borders, automatically necessitating cruise itineraries of many days' duration. We wonder if stricter application of cabotage rules under the new Presidential Instructions will only serve to further limit the ability of foreign cruise ships to embark and disembark passengers within Indonesian territory, becoming yet another obstacle to national cruise shipping?
• Large Investments Needed for Cruise Ships - Modern cruise ships represent huge investments of many millions of dollars. Will new rules mandating Indonesian flagging and, by extension, 100% Indonesian crews make it problematic, if not impossible, for local investors to acquire the modern tonnage and highly-skilled technical personnel needed to commence building a modern cruise shipping fleet? Perhaps an interim accommodation in the regulations, facilitating the chartering/leasing of foreign flagged cruise ships by national operators might serve to accelerate the development of this neglected sector of the economy.
• The Need for a Cruise Shipping Ombudsman. While the Government has long proclaimed its desire to encourage cruise shipping based on the many economic benefits that follow therefrom, the simple truth it that the problems preventing cruise shipping in Indonesia are often regulatory-based and cross-sectoral in nature. Taking the Government at its word and assuming an Indonesian cruise industry is a valid long-term goal for the Nation, we believe that the President should immediately appoint a senior Cruise Shipping Ombudsman with direct access to the Presidential Palace and the members of the Cabinet. Only in this way can obstacles to cruise shipping be quickly eliminated and specific steps taken to encourage the establishment of a national cruise fleet.
The Argument for Cruise Shipping
Indonesia can be justifiably proud of the many thousands of young Indonesians who are serving with distinction on cruise ships around the world, sending home much needed foreign exchange. Companies such as Holland America consistently win "best cruise service afloat awards" utilizing service crews dominated by Indonesian floating-hotel staffs. The training and recruitment of cruise staff for foreign going vessel has become something of a major industry in Bali.
Thus, we find it both ironic and sad that despite the many obvious attractions of the destination, little or no employment opportunities exist for employment for Indonesian crews closer to home.
Beyond the obvious benefits to the national economy of the many high-paying and highly-skilled jobs that a national cruise industry promises, let's not forget the money cruise passengers would bring to remote island destinations visited by a domestic cruise fleet. We have witnessed first-hand the powerful multiplier effect of such spending and how it can bring the benefit of economic development to areas that might otherwise have to wait decades before enjoying the fruits of national development.
We believe the cruise shipping segment of national economy offers great potential and warrants treatment as a special case in development planning. Given the very substantial potential benefits of the cruise shipping sector we urge consideration of specific set of Presidential Instructions aimed solely at fostering growth in this area of the economy.
Smooth sailing to a propserous future tourism economy demands it!