What is the best way to ship goods to Indonesia ?
We assume that you are close to conclude a deal between China and Indonesia if you landed on this page. After a decade of freight forwarding between the two countries, we noticed that our clients asked us regularly the same types of questions. No matter of the type of goods, the quantity and the volume they need to transport, they all had the same interrogations on the import process. To synthetize our answers, and to help other people who may have to perform in international trades, we decided to build this great page detailing all you need to know about trades in goods between the two Asian countries. Without regarding if you’re a beginner, a skilled international trader, if you need to import full containers regularly or a tiny parcel once, you will find valuable information here, that will help develop your trading process. Also, we put several links and personal advices along this article, that will surely help you.
SINO Shipping is amongst the greatest freight forwarder in the Chinese and the Asian market. You can ask us to plan sea or air freight between the two countries, even if your products are hazardous or perishable.
In a first part we will discuss the different freight possibilities. In a second part we will talk about the Indonesian customs clearance process. And finally, we will overview the economic and politic relationship between China and Indonesia.
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Customs clearance in Indonesia
Yes, you can! As a member of the ASEAN community, Indonesia is applying the ASEAN – China Free Trade Area (ACFTA), which suppressed tariff barriers on 90% of the goods traded between the two zones. This explains why there are great chances for your shipment to be totally exempted of duties and taxes.
First of all, be aware that without an authorization from the Indonesian government, you cannot perform international trade. To be allowed, you must comply with official rules.
The Original Certificate of Preferential Origin (CO)
The certificate of origin is an essential when it comes to customs clearance and global trades. Like its name is indicating, it’s a proof that the goods contained in your shipment were produced in a defined country and place. A notary public or a government agency should issue the CO to make it valid, and it also needs to be signed by the Exporter and the local Chamber of Commerce. Customs will also determine if the ACFTA preferential rates are applying on your products, thanks to this document.
The customs declaration
This document is helping customs to ensure the goods that are entering the national territory can not affect the local environment, safety or economy. It is a form that provides information about all the listed goods listed the import. The exporter should complete the “pemberitahuan ekspor barang” (PEB) version, while the importer should complete the “pemberitahuan impor barang” (PIB) version of the document.
The Invoice is used by customs to check if goods issued by the exporter are the same as the one declared by the importer.
The Bill of Lading (BL) or Airway Bill
After the Certificate of Preferential Origin, The Bill of Lading is the second most important document when it comes to imports. Data and information on the cargo are provided on the BL, as well as details on the products are written on the CO. You can also find on the BL the details of the payment to the carrier. It is the necessary document for the issuance of the Letter of Credit (LC). The Bill of Lading is released for an Ocean freight, while the Airway Bill is released for an air freight.
Here is a scheme of the information available on a BL, plus their sequence:
1 = Shipper
2 = Consignee
3 = Notify party
4 = Vessel No.
5 = Port of loading / discharge
6 = Place of receipt / delivery
7 = Containers No.
8 = Goods description
9 = Net weight
10 = Dimensions / volume
Import permit (if necessary)
It depends on the type of goods you’re importing, and of your company profile. The customs will give you further details about it.
Packing list for multiple goods
The HS code of the products you’re transferring must be indicated in. The MSDS document and the international codes of the products are also required if you’re importing dangerous or chemical products.
Like all the ASEAN countries, and more largely all countries in the world, Indonesia is utilizing the Harmonized System (HS) of tariff nomenclature to identify traded goods. It is a combination of numbers called HS Code, attributed to each type of goods, to standardize goods identification worldwide.
The picture hereafter is explaining you which meaning you should put behind each number:
This schedule is sorting goods by order of HS code number and details the corresponding tariff barriers. To continue our example, let’s find out what duties and taxes are applying on pineapples. On the line number 1077, it’s indicated that no tariff barriers are applying on Chinese pineapples.
The second method to determine your goods tariff barrier is to go on the ACFTA official website, and use the Tariff Finder on the right of the page. Put China as the “Country of Origin”, Indonesia as the “Country of Destination”, and the name of your product in Key Words. Still for pineapple, you will obtain the same result.
The process is using electronical methods to reduce the paperwork and interactions between the customs and the importer:
- The Importer and the Exporter are asked to provide their part of the Customs Declaration to the corresponding Customs Office.
- All the documents detailed previously must be gathered in a file and sent to the Customs Office.
- The Importer will pay the duties and taxes (if existing) to the customs, based on his self-assessment.
- The customs official will verify is the customs declaration and the duties and taxes are entirely given.
- If everything is concordant with the regulation, the release letter will be issued. It is called the “surat pemberitahuan pengeluaran barang” (SPPB). Then the goods will be freed from custody and delivered to the importer.
- If it isn’t concordant, the Customs declaration will be cancelled, and both the exporter and importer will have to revise and restart the entire process.
Customs contact in China
Customs contact in Indonesia
The different Channels
As in many other Asian countries like Singapore, Indonesian customs implemented a channelling process to ease the customs treatment of each enterprises and shipments. It is based on the importer’s profile, the category of goods he’s importing and his track record.
The Red Channel
It is the one followed by new importers, or importers with a poor track records due to bad previous imports and some categories of goods with high risks. This channel will incur an intensive follow-up and goods will be automatically inspected physically.
The Yellow Channel
This channel is for importers with a correct track record, and for goods with a medium risk. If the shipment is selected for a random test or if customs intelligence indicates a deeper goods’ inspection, the goods will be physically examined.
The Green Channel
This one is for importers with a good track record, and for products with low risks. Physical inspection of the items will be processed if the same conditions as in the Yellow Channel are arising.
The Special Priority Channel
It is the easiest one for importers. Called “Mitra Utama” (MITA), for importers with perfect track record, the goods expenditure is done automatically. The shipment will undergo Post Clearance Audit System (PCA), and a physical inspection on rare occasions. To benefit of this channel, importer must apply and be approved by the DJBC.
This scheme below is summing up the Indonesian customs process in a picture:
A long time cultural exchange and economic cooperation
Historically, Indonesia has always been influenced by China. Indonesia is owning one of the biggest collections of Chinese antiques and ceramics out of China. Because Indonesia was on the maritime silk road connecting China to India and the Arabic peninsula, the two countries have been linked since a long time ago. You can also find a lot of Chinese patterns in the Indonesian craft like batik… Recently, this relationship has been a little bit altered because of conflicts about the Natuna Islands in the South China Sea. But both parties are trying to loosen the situation.
Trades between China and Indonesia are constantly growing since the ACFTA is established. As an example, the value of trades between the two countries has been multiplied by 10 between 2003 and 2010. Investments from China to Indonesia are also greatly flowing, thanks to the Bamboo network, a network of Chinese people settled in South East Asia and running businesses there. From a nation to another, China helped develop infrastructures like the Jakarta-Bandung high-speed railway project, that will start to operate in 2019.
China is the first trade partner of Indonesia, both in terms of imports and exports according to the World Bank. In 2016, 12% of the goods exported by Indonesia were destined to the Chinese market, which represented 17 billion USD in terms of value. For imports, 23% of the goods imported in Indonesia were made in China, which was a total value of 30 billion of USD. On the other side Indonesia is the 18th import partner and the 15th export partner of China.
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As the greatest world archipelago, containing around 13,500 islands, Indonesia is one of the most spectacular and diverse nation in terms of geography and biodiversity. Its territory, going from the Andaman Sea at the far west to the Papua at the far east is home of a huge territory distributed in numerous islands. Thanks to this, Indonesia possesses a big interface with the Pacific and Indian Ocean. Indonesia is becoming a huge economic power of the Asian continent thanks to its population of 270 million of inhabitants, its good agricultural soil and its natural resources. The major challenge to achieve this dominance is the Port infrastructures of Indonesia. Except Tanjung Priok in Jakarta, other ports need great investments to provide quality and effective infrastructures to the other islands of the country.
Major ports of Indonesia
Port of Belawan – Medan – Northern Sumatra
Built in 1890, the Port of Belawan is the third largest port of Indonesia today and the biggest in Sumatra Island. It is one of the biggest points of entry and exit for goods on Sumatra Island. In 2014, the total cargo handled there was of 12 billion tonnes.
Port of Tanjung Priok – Jakarta – Western Java
It is the busiest port of Indonesia and also the most technologically advanced and performant. Historically, it is one of the oldest ports in South East Asia also. It is handling half of the flow of goods that is entering and leaving Indonesia. This is explained because of its state-of-the-art infrastructures, and by the technological backwardness of most of the other Indonesian ports. In 2016, the domestic and international cargo flow of the port was at almost 2 million of TEUs.
Port of Tanjung Emas – Semarang – Central Java
Built in the 19th century, it is connecting central Java to other areas. In 2013, it handled 1,7 million of tonnes of cargo. In 2015, 608,984 TEUs were managed. It is also an important port for passenger traffic.
Port of Tanjung Perak – Surabaya – Eastern Java
Tanjung Perak is the port serving the city of Surabaya, both in terms of goods and passengers. In 2014, 3.1 million of TEUs were handled there. Its total capacity is neighbouring the 6 million of TEUs per year.
Minor Ports of Indonesia
Port of Gilimanuk – Gilimanuk – Bali
It is the port linking the islands of Bali and Java, in passenger, Roro and cargo trucks traffic. Other ports like Benoa Harbour in Denpasar, south of Bali are more specialised into fishing and cruising.
Kupang Harbour – Kupang – Pulau Timor
It is used to enter cargo and passengers in the Indonesian part of Timor Island. It is also used for the local fishing economy.
Port of Makassar – Makassar – Southern Sulawesi
With the port of Kendari, they are the two ports where goods are provided to the southern parts of Sulawesi Island. It handled 8 million of tonnes of cargo in 2015, which represented almost 600,000 TEUs in terms of volume.
Port of Bitung – Bitung – Northern Sulawesi
It is the main point of entry to the north of the island. A Roro ferry service is linking directly Bitung to the city of Davao in the Philippines. It will provide to northern Sulawesi products such as construction materials, food and agricultural products.
Sea freight transit times
Here are the usual transit times, for a China-Australia cargo:
|Tianjin||Dalian||Shanghai / Ningbo||
Guangzhou / Hong Kong
|Belawan||15 days||15 days||13 days||11 days|
|Jambi||14 days||14 days||13 days||10 days|
|Jakarta||15 days||15 days||14 days||11 days|
|Surabaya||15 days||15 days||14 days||11 days|
|Bali||16 days||16 days||15 days||12 days|
East Nusa Tenggara
|16 days||16 days||15 days||12 days|
|Pulau Timor||17 days||17 days||16 days||13 days|
|Makassar||15 days||15 days||14 days||11 days|
|Bitung||12 days||12 days||11 days||8 days|
|Pontianak||14 days||14 days||13 days||8 days|
*Please note that those transit times are just indicative timing between China and Indonesia
Sea freight rates
*International Traders are always privileging sea freight for two major advantages: It allows to transport great quantities of goods, at very competitive prices.
These two benefits are good enough to explain why more than 90% of the trades in goods between China and Indonesia are done through Sea freight. If it is your situation, it isn’t necessary to go further, Ocean freight will be your affair.
As detailed before, SINO Shipping will furnish all kind of performance for all volumes! We really emphasize on flexibility, which enables us to greatly suit all your needs.
Indonesia has 20 international airports that are linking by air the major islands of the country to the entire world. On its side, China is a major air nation with more than 60 international airports. The cargo traffic in the Chinese airports is the most intense in the world. Numerous Asians and International cargo airlines are linking the two countries with direct and undirect flights. China Cargo Airlines and China Southern Airlines are the two Chinese companies that bonds directly Jakarta to major cities of China by air. On the Indonesian side, Garuda Indonesia has codeshare agreements for cargo planes with China Airlines, China Eastern Airlines, China Southern Airlines and Hong Kong Airlines.
Air freight transit times
By plane, 13 hours are necessary to link China to Indonesia, on door-to-door. To transfer your goods with a normal air freight, you have to count around 8 days for the final delivery. With a courier air freight (express), your products will be in your hand within 5 days.
Air freight rates
*Two distinct methods are necessary to calculate the chargeable weight of your items.
First you need to sort out the gross weight of your goods, and the volumetric weight in second.
Once that you have the results, it is the highest value that will be kept to quote your freight. You can get rid of the lowest.
*Please note that for courier freight deliveries, a different method is used to rate your goods. The volume/weight ratio is 200 kgs = 1 CBM.
*If you are situated far from a port or airport, or if you want your goods to be directly delivered at your address, you can ask for a trucking service.
Our great network enables us to offer ultra-complete road freight in Indonesia, in the major islands of the country. All the ports and airports where we are in Indonesia have a multimodal platform. All our great efforts are helping us to provide fast deliveries and enables you to spend less time thinking about your goods delivery.
All freights are composed with a part of risks. A ship accident, a storm or malice can lead to the loss or damage of your goods. To avoid the terrible consequences that can occur, SINO Shipping partnered with the most esteemed insurance companies in the freight market. A subscription will provide an extra coverage of your goods, and you will be totally compensated if your goods are lost or damaged.
You shouldn’t take any risks, if a supply scarcity will ruin your enterprise. A further protection of your shipment can’t be refused!
Why choose us ?
SINO Shipping, we understand perfectly the needs of our customers and establish a win-win collaboration with them.
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