Indonesia Has the Highest Logistics Costs in Asia

Transportation observer from the University of Indonesia (UI), Ellen Tangkudung, stated that connectivity development needs to be encouraged to enhance Indonesia's competitiveness. One of the problems faced by the business world is the high cost of logistics in Indonesia. According to Frost and Sullivan, Indonesia has the highest logistics costs in Asia, namely 24% of its Gross Domestic Product (GDP).

The high cost of logistics is particularly prevalent in eastern Indonesia. This is due to the uneven development of infrastructure in several regions. Nevertheless, the government's infrastructure development efforts over the past four years have significantly helped reduce the disparity in these areas.

Other Asian countries with high logistics costs include Vietnam, Thailand, and China. Respectively, Vietnam's logistics costs reach 20% of GDP, Thailand 15% of GDP, and China 14% of GDP. Meanwhile, logistics costs in Malaysia, the Philippines, and India amount to 13% of GDP, Taiwan and South Korea 9% of GDP, while Singapore and Japan are at 8% of GDP.

(See Databoks: [In ASEAN, Indonesia's Logistics Competitiveness Ranks 5th](https://databoks.katadata.co.id/datapublish/2019/03/08/di-tingkat-asean-daya-saing-logistik-indonesia-peringkat-ke-5))