President Director PT P e l a b u h a n I n d o n e s i a IV ( P e r s e r o ) Dr. H. Farid Padang S.T, M.M MACRO ECONOMIC CONDITIONS IN THE ENVIRONMENT OF PT PELINDO IV (11 PROVINCE)

North Maluku North Kalimantan North Sulawesi Gorontalo

East Kalimantan West Papua

Central PAPUA Sulawesi

Southeast Sulawesi South Sulawesi

Pelindo 4 Working Area : Total area ±863.748 km² ±49,7% of total area STRATEGIC ENVIRONMENT OF NATIONAL GOODS TRANSPORTATION RELATED TO CARGO SECTORS POTENTIAL, INFRASTRUCTURE, POLICIES AND OPERATIONAL PERFORMANCE

HIGHER POTENTIAL OF CARGO AND LOW CAPACITY OF CARGO INFRASTRUCTURE International and national cargo potential around 1,1 - 1,2 Billion ton, 550 Million ton food dry bulk, energy and mining material around 7-8 Million TEUs cargo, but the capacity of port infrastructure, airports, highways and railroad facilities at the average level of 50-60 percent from the capacity (source: IPERINDO, 2015)

REGIONAL ECONOMIC GAP Regional Economic Gap will still occur in the next few years, where the Western Indonesia (Sumatera and Java) still contributing 80,21% from total of national gross domestic product, whereas KTI (Eastern Indonesia) as a whole only contributes around 19,79% of national gross domestic product in Quarter I Year 2018 (source: Bappenas, 2018)

DEMOGRAPHY BONUS AND HIGH CONSUMPTION POTENTIALS Unbalanced Population distribution. The population of Indonesia in 2019 is around 271 million, where 56% live on Java. Meanwhile, the proportion of urban residents in Indonesia will continue to grow, in 2020 is around 56,7% (source: UNFPA-Bappenas, 2014). It is also estimated that in 2030 the consequences of this growth, hence the existence of the middle to upper class economic class will grow rapidly (source: McKinsey, 2013)

CABOTAGE NATIONAL MARITIME BASIC STRENGTH The fleet increase is around 250 percent (2005-2014) and domestic cargo traffic from 600 MILLION TONS (2005) till 1,1 Billion ton (2014) provide endurance to the national maritime business due to national domestic maritime strength (Source: INSA ,2014)

HIGH COST OF TRANSPORTATION AND NATIONAL LOGISTICS At present national logistics costs are still high (around 25% of gross domestic product), where about 2/3 is a component of transportation costs. In 2014, LPI is ranked 53 (with score 3.08) based on the World Bank (2014), 2018 rangked 46

CONNECTIVITY AND INTEGRATION OF TRANSPORTATION NETWORK Currently there is no intermodal / multimodal integrated network and transportation service system which connects all NKRI areas effectively and efficiently. Likewise the weakness of multimodal applications and hinterland facilities including industrial estates or warehouses 3 COMPARISON OF LOGISTIC COSTS IN PORT & LPI WORLD BANK

COST OF LOGISTICS COMPONENT • Customs • Packing List • Insurance • Security • Fuel Oil (Producer- Port-Shipping Agent- Port-Consumer) • Vessel Crew and Documentation Administration • Vessel Services Truck Driver/Train Handling & • Vessel Operational Cost • Wharfage Inventory • Handling and Truck/Train Transportation • In and out ports tariff Cost • Loading/Unloading (land and sea) Costs Cargoes • Stacking • Haulage • Demurrage • Container Lease • Container Repair COMPARISON OF THE QUALITY OF INDONESIA INFRASTRUCTURE • Tool Rental Services

Source: WEF (2017), infographic by SCI.

More than 17.000 Indonesia Island Critically depends on shipping Pillars & Indicators Indonesia Logistic Cost is 24% of GDP INTEGRATED PORT TRANSFORMATION : SUPPORTING INDONESIA INDUSTRY 4.0

MULTIMODAL TRANSPORTATION Port Selection Level (Market Attractiveness) OPERATION SCHEME PORT SERVICES SCHEME

Cargo Owner Shipping Lines Land Transport

Accessibility Berth Availability Accessibility

Connectivity Port Time Cargo Handling Time

Service Quality Geographical Location Equipment Reliability

Time-Efficient Connectivity Time Operation

Port Dues Equipment Productivity Distance to Port

Flexibility Port Dues Stacking Space Port Centre Logistics Logistic Integration / SCM Cargo Potential Cargo Volume Phase 5

Phase 1 Phase 2 Phase 3 1. Vertical Interaction Operator- Providing Phase 4 Integration Port Providing Customers Logistics Modern Integration of Trade, & Logistic Improvement of added Warehouse & Service with value logistics service Port, and Supply Chain Depo/IT-based 2. Lean & Agile In minimum/stan Physical inventory Provision of high added Transformation of value service Logistics dard added goods from raw facilities value material Process (SCM) Pelindo 4 is positioned between Phase 2 & 3 Pettit and Beresford 2009, Port Logistic Transportation ONE STOP PERMIT SERVICES AND COMMODITIES EXPORT PROCESS

Governor Circular Cross Sectoral Government Agencies

Customs - Clearance Customs Quarantine Marine and Fisheries One-Stop Permit Services Pre - Clearance Immigration IPSKA & Quality Certification Export Container Handling Services PORT SERVICE CUSTOMER Integrated Cargo Forwar Shipping Truck / JPT PBM Owner ding Agent InaporNet System DO OnLine COORDINATION BETWEEN CUSTOMER Exporter One-Stop Permit Services Advantages: 1. Acceleration of the Export Process; 2. Shorten time and cost efficiency; 3. EDI Implementation ( Electronik Data Interchanger ) more optimal; 4. Supervision and Monitoring ( Check and Balance ) to the export commodity is more accurate and valid; 5. Power of Branding to the commodity of South Sulawesi Exports through certificates of origin of commodities and quality assurance / quality of export commodities IPSKA : Issuing Agency Certificate of Commodity Origin INTERNATIONAL DIRECT CALL / DIRECT EXPORT

Direct Export Excellence : • Export activities towards European and American = IMPORT  Export quality is maintained <20 days to the destination = EXPORT Chocolate / America countries implemented with Direct Export through China (Shanghai) with Joint Slot under Hapag-Lloyd and SITC. port (export endurance at least -20 C); Cocoa Beans  With cost & time efficiency, will open opportunities for of Europe Ceramic state owned enterprises

Busan Yokohama Cost Improving Efficiency Usage L/C Asia Shanghai ● Shorter shipping distances ● Mandatory L/C Rules & lower unit transit cost ( 30 days  2 days ) — Playwood Frozen Fish Hongkong ● Improve capacity, Seaweed DIRECT CALL ● New & expanded trade relation Marble reliability& transit time (develop logistic zones) Seaweed ● Immediate delivery time of cargo Vietnam Time Eskalate Medium Regional Efficiency Business Income Frozen Fish Philipine Seaweed Direct Call Excellence : Wheat  Support the implementation of the development of Eastern Indonesia especially South Sulawesi;  Supporting the program in accelerating infrastructure and Malaysia building connectivity; Singapore East Asia Europe America  Operation Excellent by increasing the quality of commodities into finished goods through the downstream process;  Offers an option of shipping cost from FOB with the risk of US$ 200 /box US$ 500 /box the goods being in the hands of the recipient becomes CIF where security and quality of goods are the shipper Cement China : 24  9 days 5 days responsibility. Wheat Japan :28  15 days Timor Leste Project goods Korea :26  17 days TERMINAL HANDLING CHARGE FROM PORT TO PORT DOMESTIC, DIRECT EXPORT & DIRECT CALL

CHANGE STATUS PROCESS + CONTAINER INTER-ISLAND VESSEL MLO VESSEL DOMESTIC domestic export INTER-ISLAND VESSEL DOMESTIC Free Stacking Efficiency to 5 days DE 54,5% D M Rp 500.000 Rp 500.000 Export document Stuffing/stripping USD 83 Trucking 1,5-2 Million

Makassar TOTAL : Rp500.000 + Rp500.000 + Rp2.000.000 + (USD 83 x Rp 13.200) = Rp 4.095.600/BOX DM BL / LC Time : 5-9 days minimum / Jakarta transit change container + vessel

DIRECT EXPORT INTER-ISLAND VESSEL INTER-ISLAND VESSEL No MLO VESSEL Free Change Status + Container DIRECT EXPORT Stacking BL / LC 14 days D E Rp 500.000 Rp 500.000 USD 56 Efficiency to Makassar Surabaya / Jakarta Transhipment TOTAL : Rp 500.000 + Rp 500.000 + (USD 56 x Rp 13.200) = Rp 1.739.200/BOX DC Time : 3-5 days maximum 57,5%

MLO VESSEL MLO VESSEL DE DIRECT CALL BL / LC D C USD 60 USD - USD - Makassar Surabaya / Jakarta Stay On Deck TOTAL : USD 60 x Rp 13.200 = Rp 792.000/BOX Time : No Dwelling Time Efficiency DC 80.66% DM MAJOR EXPORT & IMPORT (TEU’s) VIA MAKASSAR CONTAINER TERMINAL

39,648 37,971 15,496  Compound Annual Growth Rate  14,421 CAGR

 Import (PIB Alih Status) 29,182

10,570 15.28% 24,136 8,774  Direct Import 14,167 14,237 5,282 5,145 19.5%

3,011  Export (PEB Alih Status) 7,326

72 11.9% 387

2015 2016 2017 2018  Direct Export 2015 2016 2017 2018 IMPORT DIRECT IMPORT 24.8% EXPORT DIRECT EXPORT + 5.24%

Import : Export - 3.29% Direct Import : Direct Export

7,326 14,167 14,237 37,971 24,136 29,182 39,648 387

3,011 5,282 5,145 8,774 10,570 14,421 15,496 72

2015 2016 2017 2018 2015 2016 2017 2018 DIRECT IMPORT DIRECT EXPORT IMPORT EXPORT INTERNATIONAL DIRECT CALL / DIRECT EXPORT VIA MAKASSAR CONTAINER TERMINAL Ship's Call Throughput

Ship’s Call Throughput 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 4 49 50 49 21 1.252 15.571 23.460 23.579 9.385 Call Call Call Call Call TEU’s TEU’s TEU’s TEU’s TEU’s

% % 49.6 39.3 % % % % 157 100 92 UT June 1.252 TEU’s UT June 88 4 Call 2015 2015 9.385 TEU’s 2019 21 Call Call 2019 TEUs % % 102 130 % 2016 49 Call % 2016 15.571 TEU’s 102 — 116 2018 49 Call 2018 23.579 TEU’s — SHIP’S THROUGHPUT CALL TEU’s % % 104 150 2017 50 Call 2017 23.460 TEU’s

Des 2015 2016 2017 2018 s.d Juni 2019 Des 2015 2016 2017 2018 s.d Juni 2019 INTERNATIONAL DIRECT CALL / DIRECT EXPORT

SHIPS CALL MAJOR EXPORT (TEU’s) CAGR 22.14 % 2018 2019 2 per. Mov. Avg. (2019) Via Port of Makassar 2017 - 2018 Direct Call 2016 5 % 1% 1.64 526 152 Direct Call 20182018 4 4 4 4 4 4 4 2% 5,549 756 3 3 3

2

% 222 745 909 178 Korporat COMMODITY Domestic 98%98.3 2,160 624

7,047 1,054 Korporat JAN FEB MAR APR MAY JUN % 99% 1.33 CONTAINER THROUGHPUT Direct Call 2017 1% 2017 CONTAINER(TEU'S) THROUGHPUT SEAWEEDR U M P U T MARMERMARBLE CASHEWB I J I FROZENI K A N FISHSEMEN COKELAT PLYWOOD U D A N G LAUT MENTE BEKU CEMENT COCOA PLYWOOD BEKUFROZEN (TEU'S) NUT SHRIMP 2017 2018 % DomesticKorporat MAJOR IMPORT (TEU’s) 99%98.7

Via Port of Makassar 2017 - 2018 THROUGHPUT

0.9% Direct Call 2016 1% 2016 116 466 1,316 126 623 % DomesticKorporat 99.1 46 99% 107 124 16 -

Jan Feb Mar Apr May Jun KERAMIK MESIN S P A R E B I J I P ALIVESTOCK KA N CERAMIC MACHINE SPAREPARTPART PLASTIKPLASTIC TERNAK 2018 1,707 1,583 1,352 2,349 1,756 1,382 SEED FEED 2019 1,186 1,378 1,663 1,991 1,805 1,362 2017 2018

Jan Feb Mar Apr May Jun 2018 1,707 1,583 1,352 2,349 1,756 1,382 2019 1,186 1,378 1,663 1,991 1,805 1,362 MAJOR EXPORT & IMPORT COMMODITIES (TEU’s) VIA MAKASSAR CONTAINER TERMINAL

MAJOR EXPORT (TEU’s) Via Port of Makassar 2017 - 2018

526 152 MAJOR IMPORT (TEU’s) 756 5,549 Via Port of Makassar 2017 - 2018

222 745 909 178

2,160 624 116 466 1,316 126 7,047 1,054 623

46 107 124 16 - R U M P U T MARMER B I J I I K A N SEMEN COKELAT PLYWOOD U D A N G SEAWEED MARBLE CASHEW NUT CEMENT COCOA PLYWOOD FROZEN SHRIMP KERAMIK MESIN S P A R E BPLASTIC I J I P ALIVESTOCK KA N LAUT MENTE FROZENBEKU FISH BEKU CERAMIC MACHINE SPAREPART PART PLASTIKSEED TERNAKFEED 2017 2018 2017 2018 COUNTRY RANK OF EXPORT IMPORT

8 7 6 5 4 3 2 1

— GERMANY TAIWAN USA VIETNAM JAPAN MALAYSIA SOUTH KOREA CHINA EXPORT 2.535 2.730 5.256 5.698 9.504 10.705 14.178 80.201 Ton TON TON TON TON TON TON TON TON — GERMANY TAIWAN USA VIETNAM JAPAN MALAYSIA SOUTH KOREA CHINA

EXPORT 166 184 345 348 713 613 875 4.984 TEU’s TEU’s TEU’s TEU’s TEU’s TEU’s TEU’s TEU’s TEU’s

1 2 3 4 5 6 7 8 CHINA USA AUSTRALIA THAILAND MALAYSIA JAPAN RUSSIA BELGIUM — 34.338 3.929 2.934 1.340 1.183 1.084 988 504 TON TON TON TON TON TON TON TON IMPORT CHINA USA AUSTRALIA THAILAND MALAYSIA JAPAN RUSSIA BELGIUM Ton — 1.864 222 174 95 95 58 76 36 TEU’s TEU’s TEU’s TEU’s TEU’s TEU’s TEU’s TEU’s IMPORT  TEU’s DWELLING TIME

PRE CLEARANCE CUSTOM CLEARANCE POST CLEARANCE Semester I TA. 2019 Semester I TA. 2019 2018 2019 2018 2019 Semester I TA. 2019 2018 2019 2018 2019 2.50 2.00 1.20

1.80 0.54 0.86 0.87 0.61 2.00 1.00 1.60 1.00 1.00 1.00 1.00 1.00 1.00 0.50 2.29 2.18 0.76 0.33 1.40 0.80 0.68 0.33 0.63 1.50 1.20 0.65 0.29

1.00 0.60 0.98 0.96 0.57 1.00 0.56 0.80 1.00 1.00 1.00 1.00 1.00 1.00 0.49 0.48 0.77 0.45 0.46 0.71 0.40 0.60 0.69 0.11 Days 0.60 - 0.50 0.40 0.20 0.20

- - - Jan Feb Mar Apr May Jun Jan Feb Mar Apr May Jun Jan Feb Mar Apr May Jun DWELLING TIME PM 25 Tahun 2017 Post Clearance Pelindo 4  Deadline for storage in line 1 max. of 3 days SEMESTER I TA. 2019 Post Clearance

0.74 Pre Clearance The date and time of The date and time of container removed from container placed on quay yard layer 1 quay yard layer 1 0.43 1

Pelindo’s efforts & initiation “ to serve users “ Custom in the acceleration process Clearance of Pre Clearance MAKASSAR NEW PORT DEVELOPMENT PLAN ULTIMATE STAGE ( PHASE III / MNP IEZ )

Makassar New Port will become the largest hubport LAND AREA in Eastern Indonesia, where the industrial area will be developed at the ultimate stage : 1.428 Ha for the area of commodity processing and manufacturing (downstreaming)

DEVELOPMENT ADVANTAGES RETRENCHMENT

Berth : secant pile Cost efficiency ● There are only 2 in the world (Liverpool & MNP) Rp 594 Billion ● 100% domestic component rate (efficiency of around 15%) Integrated Trans Sulawesi Railway & Toll Roads

Container loading unloading equipments : Time & cost efficiency ● Upgrade Refurbish Rp 804 Billion ● Domestic Component Level more than 40% (efficiency is around 50%)

Simultaneously carried out 2 sides (sea and land) Time efficiency of 5 months ● Stock material : direct production on site

Berth Length : Reclamation efficiency 320 meters is optimized to be 362 meters

Breakwater efficiency of around 6% due to seabed conditions that require redesign Project Owner : THE NATION'S WORK Berth carrying capacity increased 67% ● PT Pelabuhan Indonesia IV (Persero) from the planned 1,200 Tons to 2,000 Tons MAKASSAR NEW PORT DEVELOPMENT PLAN ULTIMATE STAGE ( PHASE III / MNP IEZ )

MNP PORT DEVELOPMENT PHASE IA Leading Business Development

MNP PORT DEVELOPMENT PHASE IB - IC MAKASSAR NEW CIVILIZATION CITY

MAKASSAR NEW CIVILIZATION CITY BLOCK PLANE MAKASSAR NEW PORT INTEGRATED ECONOMIC ZONE

ENERGY CENTER 204.15 Ha CEMENT 48 Ha CHEMICHAL INDUSTRY 34.5 Ha

CPO 50 Ha FERTILIZER 30 Ha STEEL INDUSTRY 20 Ha

PHASE IC PHASE IB PHASE IA BRIGDE ALTERNATIF 900M’ RF 3 Ha WTP 5 Ha GAS INDUSTRY 12.5 Ha

MANUFACTURE OTOMOTIF 57 Ha

MNP PHASE II

PROCESING COMODITY 63 Ha

ICD WAREHOUSING

PORT OF PAOTERE

JALUR KERETA MKS-PAREPARE

MAKASSAR NEW PORT ACCESS ROAD PLAN RAILWAY CONSOLIDATION INTEGRATED WITH RAILWAY MAKASSAR NEW PORT OFFICE BUILDINGS COASTAL ROAD MKS-PAREPARE

EXISTING TOLL ROAD ROAD ACCESS PLAN FOR MNP T h a n k Y o u