Port Development in DKI Jakarta: Benefit or Diseconomies?


By August 2016, The New Priok Port Project or North Kalibaru Terminal began its first phase operation. This project will make DKI Jakarta to have the most adequate port in Indonesia by 2030 (the time of New Priok Project expected to finish). On the other hand, this project also aligns with the vision of the current President of Indonesia, Mr. Joko Widodo, to make Indonesia as the world maritime axis. As a response for this port development and its emerging role for the country, the central government issued the regulation number 3 of 2016 on acceleration of national strategic projects. In this regulation, North Kalibaru Terminal included in national strategic project. This port development project also responds to the fact that there has been no new terminal development in Jakarta in more than 20 years which hopefully. Also, with this terminal hopefully that the current domestic terminal in Tanjung Priok Port can return to its main function as it was used for international cargo as well.

Nowadays, Tanjung Priok Port handle more than 50% international cargo of Indonesia trade in which this fact brings Tanjung Priok Port as the main Port of this country. Despite of the important role of this port, Tanjung Priok Port has suffered some problems regarding the lack of capacity and some political issues related to Jakarta International Container Terminal acquisition back in 2008.

On the other hand, DKI Jakarta is highly suffering with its traffic jam. TomTom Traffic Index release the ranking list of the most traffic city in the world and placed DKI Jakarta in the third place. For sure, logistic cost would be affected by this condition as the cargo most likely pass through DKI Jakarta road facility also. Additional fact also says that the current national logistic cost reached 24,6% from GDP. Another important aspect in regional trading activity is the absence of Export Processing Zone. Export Processing Zone (EPZ) in DKI Jakarta is handled under PT Kawasan Berikat Nusantara. While the emergence of Tanjung Priok increased due to the rapid growth of export and import goods, the interest of investment in EPZ in DKI Jakarta doesn’t seem to show the similar trends. This situation also compounds the problem faced in DKI Jakarta

An Undergraduate Student from UI – Industrial Engineering Department, Anggit Prakoso, spent six months to working on a research on this field. He developed a system dynamic model & simulation to gain understanding of interaction in this problem and conducted an analysis regarding the result.

The problem is considered as a complex system due to the major trade off by port investment which makes it suitable to use system dynamic approach. This model also relevant with some theories such as Porter’s industrial cluster theory, Port Regionalization by Rodrigue, and so on. Bottom line of the theory regarding port development, is that port will generate employment and a good economic impact for the region. But remembering the problem faced in DKI Jakarta, this positive impact might not yield at its maximum outcome

Model can be a suitable tool for understanding the situation and making decision with the built “mimic system”. With model, decision maker can better understand what’s coming right through them, what is really important thing to be considered, and also what is not. Also, as mentioned before model can lower the risk of making decision in real system by making decision prior to the “mimic system”.

This model takes in to account five major things in its development: Export Processing Zone, Logistic Infrastructure, Logistic Cost, Port Operation & Investment, and Economic Growth. The current policies: progressive tax and access road development also involved in the model as the intervention variables.

The result shows that the GDRP of DKI Jakarta will increase over year. The contribution to GDRP value from port development and EPZ expressed in how much they will generate employment and having household consumption. Port development in DKI Jakarta will enable the economic growth in DKI Jakarta from employment and household spending. The more investment on the port the more they need human resource to manage it. Road density in DKI Jakarta will most likely to increase over years though in some access like in Jakarta-Cikampek Toll Road, which is passed through by more than 70% cargo handled in Tanjung Priok Port, show a declining road density as the road development project implemented. But, this situation will not last long as the growth of vehicle on road increase over years. The impact to logistic cost shown by the cargo from EPZ that is assumed not having any road development plan in its access road. When road density became 100%, the logistic cost yield in a sudden increase of it and this situation makes EPZ production became slower in some period of simulation. Progressive tax policy also affects the cargo calling time and pricing scheme of cargo. With this policy, pricing scheme will be much costly for shipper than before but it will make the cargo calling time by shipper became shorter than before.

DKI Jakarta will have the most adequate port in Indonesia and with the spirit in developing national maritime performance that kept over years it is really possible to make Indonesia as world maritime axis. But we also find alignment between port development and regional development. We can’t leave the opportunity lost by neglecting one and another aspect in both of them though. Both port and region should grow in integrity.


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