Roundup: China's Maritime Silk Road initiative to help boost Indonesia's trade, investment--analysts

nalysts

by Abu Hanifah

JAKARTA, April 14 (Xinhua) -- An advanced and integrated maritime interconnection system was regarded to significantly boost trade and economy of Indonesia as it would rejuvenate the nation's shipping service like it was happened in the ancient Indonesian kingdom era and continued during the Dutch colonization.

China's Maritime Silk Road (MSR) initiative would greatly bring benefit to Indonesia should it be aligned with the idea initiated by Indonesian President Joko Widodo to make the archipelago nation the world's maritime axis, analysts said.

"Maritime highway is actually not a new thing as it is very much reminiscent to Indonesia's ancient history which has excellent maritime transport serving islands across the country during the old kingdom era. Until in the 15th century it served trade to India, China, Africa and Arab countries," Umar Juoro, an Indonesian prominent economic and development analyst said Thursday in an exclusive interview with Xinhua in his office.

Umar who heads fellow analysts at the Habibie Center and member of director board at Center of Indonesia Development and Economics Studies (CIDES) said that the intense maritime trade with China and Arab countries had even shaped cultures of Indonesian kingdoms and people living in coastal areas at that time.

The advanced maritime connectivity continued during the Dutch colony as they built seaports across Indonesia to transport tobacco, spices, rice and other agriculture commodities directly from most of those seaports to Europe, Umar added.

"The ship transportation and port infrastructure built by the Dutch colonial was apparently effective, efficient and lucrative. But after the independence, Indonesia had never built seaports. The centralized government that situated in Jakarta made ports in the region no longer allowed to serve cargo and people transport to foreign countries," Umar said, adding that government appointed Jakarta's Tanjung Priok as the only seaport serving such activities.

Umar said that as demand increases, Indonesian government has initiated plans to build more seaports and other infrastructure to facilitate investors planning to invest in the country that would eventually help the largest economy in Southeast Asia region pursue higher growth.

The then government has initiated it with a master plan to accelerate economy development across the country by building seaports, power plants and airports.

The idea was continued by the current government led by President Joko Widodo who planned to advance maritime transport through maritime interconnection project that constitutes construction of 24 seaports across the country that requires 700 trillion rupiah (about 55.4 billion U.S. Dollars).

If the idea was successful, it may help the nation attain 7 percent growth, from the average of 6.5 to 6.7 percent, during President Widodo's term.

President Widodo has promoted the idea in several international forums he attended previously, seeking investors who were willing to support the idea.

Indonesia's maritime transport is now facing ineffectiveness as Tanjung Priok seaport cannot accommodate very large inter- continent cargo ships that can directly sail to Europe and the United States.

The shipment to Indonesia from Europe and the United States were facilitated by nearest ports in Singapore and Port Klang in Malaysia which later on transported by smaller ships to Indonesia.

The construction of new seaports installed with modern facilities in several regions across the country would help boost industrial activities in areas other than Java and Sumatra that hold 70 percent of the nation's Gross Domestic Product.

In modern days, Umar expected that the possible integration of MSR and Indonesia's global maritime axis would also bring benefit in Indonesia's investment sector.

"As long as it is based on rule of law, I kind of support the idea of MSR integration with Indonesia's maritime axis idea," Umar said, adding that the two ideas were actually complimented to each other.

Cornelis Luhulima, an analyst at Indonesian Institute of Science (LIPI) through his analysis recently published by an influential Indonesian media said that Indonesia's maritime highway plan could be part of the Maritime Silk Road of China in the 21st century.

"Interoperability level on the east-west direction in Indonesia will be strengthened, would further promote the growth of Indonesia's marine economy," he said.

"The alignment of Indonesia's maritime highway into the Maritime Silk Road would create a super highway in the sea. China financial strength will ensure the promotion of Maritime Silk Road Initiative, meanwhile Indonesia's maritime highway program would inevitably favor China's interest," Luhulima said. Endi