Indonesia to cut logistics costs to boost export competitiveness

By Alimat Aliyeva

The Indonesian government plans to simplify bureaucracy and regulations to reduce logistics costs and enhance the competitiveness of its products in international markets, Coordinating Minister for Economic Affairs Airlangga Hartarto announced, Azernews reports, citing foreign media.

The minister emphasized the government's strong commitment to boosting exports, which have consistently contributed to Indonesia’s trade surplus in recent years. A key strategy is to lower logistics costs in order to improve overall economic efficiency.

“We are pushing for a reduction in our logistics costs. Currently, it stands at about 14.5 percent. We hope to bring it down to 12.5 percent, and eventually to 8 percent,” Airlangga said during a press conference.

He highlighted that most ASEAN countries already enjoy single-digit logistics costs, stressing that Indonesia must follow suit to remain competitive in the regional and global markets.

To achieve this goal, the government will begin implementing deregulation measures starting in November. This initiative aims to simplify rules and eliminate policies that hinder operational efficiency and increase costs, the minister explained.

Airlangga also revealed that the government plans to identify products with particularly high logistics costs and prioritize efforts to reduce these expenses, thereby strengthening supply chains and boosting the export potential of key industries.

Reducing logistics costs not only helps Indonesian exporters but is also expected to attract foreign investment by creating a more business-friendly environment. Experts believe that successful implementation of these reforms could significantly enhance Indonesia’s position as a strategic trade hub in Southeast Asia, especially as the country continues to expand its role in global value chains.