President’s proposal to invite foreign airlines to Indonesia, supported by the Minister of Transportation

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Joko Widodo suggest to invite foreign airlines to Indonesia. (photo: rakyatmedan.com)

IO, Jakarta – President Joko Widodo (Jokowi) plans to implement the open sky system. The method is by inviting foreign airlines to enter Indonesia. Because, the more airlines, the price of airplane tickets will be increasingly competitive.

President Jokowi also acknowledged that the government had tried to reduce the price of airplane tickets. Steps that have been taken such as lowering the Upper Limit Rate (TBA) and increasing the Lower Limit Rate (TBB).

Then, the price of avtur fuel has also been lowered because it is considered to contribute almost 40 percent to the total costs borne by airlines.

“Lower Boundary Rates and avtur prices have been lowered to the original price. Indeed, the price of airplane tickets has not returned to normal. Maybe the competition is not much,” said President Jokowi.

The country’s aviation industry is currently dominated by two major players, namely Lion Air Group (Lion Air, Batik Air, and Wings Air) and Garuda Indonesia Group (Garuda Indonesia, Citilink, Sriwijaya Air, and Nam Air). The limited number of players in the industry has an impact on the pricing of airplane tickets that are less competitive.

“We will increase this competition, so that they (the airlines) will be more efficient. I think in the country itself if there is competition, it will be good,” said President Jokowi.

Meanwhile, Minister of Transportation, Budi Karya Sumadi, will review the idea of ​​President Joko Widodo. Minister of Transportation Budi said the idea could be implemented as long as it did not violate the cabotage principle.

The cabotage principle is no more than national ownership of shares, namely 49 percent owned by foreigners, 51 percent owned domestically.

“The foreign company must have a company here where Indonesia is 51 percent, besides that it must also follow other conditions,” he said.

The Minister of Transportation said the policy does not need to replace existing and applicable laws. “No need to be replaced, others just follow. I think a good idea from the President,” he said. (Dsy)