Optimizing the 2024 APBN with National Logistic Ecosystem News – 1 hour ago

Jakarta, CNBC Indonesia – The National Logistics Ecosystem (NLE) is one of the government’s strategic steps to face future logistics performance challenges, thereby making a major contribution to the national economy.

“Digital collaboration on one platform (NLE) will ensure the smooth movement of export and import goods flows, as well as the movement of domestic goods flows, both between regions within one island and between islands,” said Head of the National Single Window Institute (LNSW) Agus Rofiudin.


Logistics Contribution to the Economy

National economic growth continued its positive trend, growing above 5 percent for seven consecutive quarters. Bank Indonesia (BI) estimates that in the third quarter of 2023, national economic growth will be in the range of 4.7 percent to 5.5 percent. This positive growth shows that the national economy is resilient amidst the global economic slowdown.

Maintaining the national economy, one of which cannot be separated from the performance of national trade. According to the Central Statistics Agency (BPS), the national Trade Balance (NP) has always been in surplus for the last 41 months. The positive NP contributed to the controlled (deficit) of the current account, which according to BI was recorded as low amidst conditions of falling commodity prices and a global economic slowdown as well as an increase in domestic demand.

BI in its Quarter II-2023 report stated that the performance of capital and financial transactions remained under control. This is supported by direct investment or Foreign Direct Investment (FDI) amidst high conditions of global financial market uncertainty. Solid direct investment indicates maintained positive investor perceptions of the domestic economic outlook.

Joint inspection between Makassar Agricultural Quarantine and Makassar Customs and Excise for garlic commodities, Makassar, 7 October 2021. (Doc. Ministry of FinancePhoto: Joint inspection between Makassar Agricultural Quarantine and Makassar Customs and Excise for garlic commodities, Makassar, 7 October 2021. (Doc. Ministry of Finance
Joint inspection between Makassar Agricultural Quarantine and Makassar Customs and Excise for garlic commodities, Makassar, 7 October 2021. (Doc. Ministry of Finance

Agus said that the importance of trade between countries and FDI is because it is an instrument for economic growth and also allows a country to consume cheaper services based on its comparative advantage.

“Trade allows a country to consume goods and services that are cheaper than other countries based on their comparative advantages. Meanwhile, FDI encourages the transfer of technology and human capital and institutional improvements from developed countries to developing countries,” said Agus.

This condition has the potential for lower logistics costs, shorter transportation times, and additional job opportunities (the business world is growing). “Delivery time efficiency encourages business productivity which has a positive influence on national competitiveness. As a result, the combination of productivity and competitiveness encourages economic growth,” added Agus.

APBN Encouragement for Smooth Logistics

The 2024 APBN Draft was officially ratified through Level II (Plenary) Discussions last September. On that occasion, it was agreed that the 2024 APBN must, among other things, be a policy instrument that can be relied upon to face economic turmoil in 2024.

Furthermore, the government has prepared the 2024 APBN with macro assumptions, such as economic growth of 5.2%, inflation of 2.8%; up to the rupiah exchange rate of IDR 15,000/US$.

State expenditure, which was IDR 3,325.1 trillion, was allocated IDR 2,467.5 trillion for Central Government Expenditure and Transfers to Regions amounting to IDR 857.6 trillion. Central Government spending is maximized to strengthen the APBN as a function of allocation, distribution and stabilization.

National economic performance is driven by leading sectors, such as Industry, Trade, Agriculture, Mining and Construction. The industrial business field is recorded as still providing the largest contribution compared to other business fields. “In this condition, the composition of national imports is still dominated by supporting raw materials. As a result, the logistics process in the form of a smooth supply of raw materials and production results must be maximized,” added Agus.

National logistics performance has not been ideal to date. The World Bank (WB) in the 2023 Logistics Performance Index (LPI), places Indonesia’s logistics performance at rank 63 with a score of 3.0. National logistics costs are still relatively high, namely 14.29 percent of Gross Domestic Product (GDP).

Joint inspection between Makassar Agricultural Quarantine and Makassar Customs and Excise for garlic commodities, Makassar, 7 October 2021. (Doc. Ministry of FinancePhoto: Joint inspection between Makassar Agricultural Quarantine and Makassar Customs and Excise for garlic commodities, Makassar, 7 October 2021. (Doc. Ministry of Finance
Joint inspection between Makassar Agricultural Quarantine and Makassar Customs and Excise for garlic commodities, Makassar, 7 October 2021. (Doc. Ministry of Finance

Infrastructure spending in the 2024 APBN reaches IDR 422.7 trillion. The direction of infrastructure policy includes accelerating the development of economic driving infrastructure (connectivity and transportation, energy and electricity, and food). Apart from that, it is also for providing basic service infrastructure and strategic projects, as well as equalizing and strengthening access to ICT that supports digital transformation.

Strengthening connectivity & transportation as well as ICT infrastructure, closely related to logistics performance. The construction of roads, bridges, airports and ports is strengthened by providing internet access points to the Digital Broadcasting System (DBS). This infrastructure development can be maximized by implementing the National Logistics Ecosystem (NLE).

NLE Maximizes APBN Functions

NLE simplifies government service business processes in the logistics sector, collaborates with private logistics service systems both domestic and international, facilitates state revenue payment transactions and facilitates payments between logistics business actors, and organizes port layouts and goods distribution routes.

This condition is made possible by the basic concept of NLE which consists of 4 pillars, namely simplification of business processes for government and private services, collaboration of logistics platforms, ease of payment, with a single billing scheme and spatial planning, with the implementation of policies that make the movement of goods more efficient.

NLE Leaders Breakfast Meeting, 23 May 2023. (Doc. Ministry of Finance)Photo: NLE Leaders Breakfast Meeting, 23 May 2023. (Doc. Ministry of Finance)
NLE Leaders Breakfast Meeting, 23 May 2023. (Doc. Ministry of Finance)

The NLE breakthrough is in the form of the One Stop Online Service System service, aka Single Submission (SSm), which continues to be developed by the National Single Window Institute (LNSW). Services such as SSm Transporter, SSm Licensing, and Single Submission Quarantine Customs (SSm QC/SSm Customs Quarantine) have succeeded in reducing business process stages, reducing repetition and duplication processes with one submission, and making it easier to manage government logistics services.

There are around 15 ministries or institutions that make it easier for business actors by no longer needing to go to each K/L to ask about regulations, processes and requirements for ease of doing business. “The aim of developing NLE is to make the process of doing business in Indonesia more competitive, both in terms of time, simplification, speed, and ultimately in terms of cost,” he added.

NLE is the responsibility of all parties and logistics entities. NLE implementation should not only focus on output, but also produce positive outcomes for society. As a result, the implementation of NLE can encourage innovation and coordination to improve logistics performance with the support of the 2024 APBN, thus contributing maximally to the national economy.

[Gambas:Video CNBC]

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