26 Jul Indonesia’s LPI Increased

Photo: Tanjung Priok Port (Pelindo II)

Based on data recently released by the World Bank, Indonesia’s Logistics Performance Index (LPI) climbed 17 places from the previous position at 63 with a score of 2.98 to 46th position with a score of 3.15. The World Bank released LPI every two years, as a comparison of logistics performance of 160 countries assessed.

The basis of the LPI assessment is the average score of each country in the six aspects of the assessment. These aspects are the efficiency of the customs process, the quality of infrastructure related to trade and transportation, the ease of arranging international delivery at competitive prices, the competence and quality of logistics service providers, the ability to track and trace consignments and the timeliness of delivery to destination .

From these six aspects, Indonesia’s infrastructure score has increased significantly, while the efficiency of the customs process is assessed to decrease from two years ago. Other supporting factors are Indonesia’s improving logistics competitiveness and the timeliness of delivery.

Despite the increase, Indonesia is still behind some ASEAN countries namely Malaysia, Vietnam, Thailand and Singapore. These countries are ranked 41, 39, 32 and 7 respectively.

In addition, improvements in Indonesia’s logistics performance have not been matched by a decrease in logistics costs. Indonesia’s logistics costs in 2017 still reach 23.5% of GDP, lagging behind other countries in ASEAN such as Vietnam (15%), Thailand (13.2%), Malaysia (13%) and Singapore (8.1% ).