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Kadin: Jokowi’s Allowance of Foreign Airlines Aids Competition and Efficiency

Indonesian Airlines

Rosan Perkasa Roeslani, Chairman of the Indonesian Chambers of Commerce and Industry (Kadin), has praised President Joko Widodo’s decision to allow foreign airlines to operate in Indonesia.

The addition of foreign airlines to the Indonesian aviation industry is set to increase business competition in the sector.

Recently, Jokowi stated that by allowing an open sky policy, airline ticket prices could be lowered as there will be more competition. These foreign airlines will be allowed to serve domestic routes.

“I think it would be very helpful if foreign airlines enter Indonesia, it would create [business] competition and improve efficiency,” Rosan said.

The current Indonesian aviation industry is controlled by two major airlines groups, namely Garuda Group and Lion Group. The Garuda group comprises of Garuda Indonesia, Citilink, Sriwijaya, and Nam Air. Meanwhile, The Lion Group operates Lion Air, Wings Air, and Batik Air.

However, Rosan did not solely blame the high ticket prices on a monopoly market. Other contributing factors affecting ticket prices include AVTUR or fuel prices and passenger loads. He also added that the presence of foreign airlines will not diminish local airlines, as the quality of services offered by the local airlines have been very good over the last few years.

“The presence of foreign airlines will push existing players to reconsider their strategies, especially on how to attract more passengers. This is very good,” Rosan concluded.

Source: Tempo
Image: Berita Trans

See: Jokowi to Allow Foreign Airlines in Domestic Routes for Better Competition, Cheaper Airfare

 

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