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More Ill-winds for Indonesian Cruising?

Sudden Introduction of 5% Bond for Foreign Flag Yachts Visiting Indonesia Threatens Efforts to Create a Cruise Tourism Sector.


Bali News: More Ill-winds for Indonesian Cruising?
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(7/30/2007)

In stark contrast to official posturing in support of developing Indonesia as a cruise destination, the Indonesian Department of Customs and Excise has suddenly introduced a new regulation requiring visiting yachts to pay refundable cash guarantee equal to 5% of the vessel's value. The fee, levied at the yacht's port of entry into Indonesia, will be refunded upon final exit of the vessel from the nation's territory.

Raymond T. Lesmana, the Chairman Indonesian Sea Lovers Foundation (Yayasan Cinta Bahari Indonesia) complained to Bisnis Indonesia that the new regulation has been implemented without prior warning from the government and at the very time Indonesia is hosting Sail Indonesia 2007, part of a world-wide cruise regatta by sailing yachts.

Explaining the new regulation, Lesmana said: "In this regard the participants of Sail Indonesia 2007 are exempted from paying the guarantee. But it is strange that a guarantee equal to 5% of the value of a yacht must be paid to Customs at the port of entry into Indonesia."

While the regulation provides for a return of the guarantee at the final port of exit, the exact mechanism for the refund remains unclear, at least at this stage.

According to Bisnis Indonesian, the Bali Marina which hosts a number of visiting yachts has been thrown into some degree of confusion by the new ruling, with many fearing that the armada of yachts at the Marina may soon weigh anchor and leave the Country.

Lesmana has questioned the wisdom of the new guarantees pointing out that Indonesia is alone in the region for introducing such a bond that may prove self-defeating in current efforts to encourage cruise tourism. According to Lesmana, more than 2,000 yachts bypass the countries outer borders each year due to uncertain or problematic legal standing for visiting yachts. At the same time, Lesmana estimates that visiting foreign yachts calling on Indonesia ports spend an average of Rp, 17.5 million(approximately US$1,900) during each week of their stay.

While other countries in the region are working to simplify foreign yacht visits, vessels wishing to call on Indonesia are required to secure a costly and time-consuming Clearance Approval for Indonesian Territory (CAIT) necessitating separate approvals from the Department of Foreign Affairs, Department of Sea Communications, the Indonesian Naval Headquarters and State Intelligence Board.

Related Story

[Bali Needs a Cruise Port]


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