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LigaAsuransi > Blog > Bisnis > Shipping Industry 2025: Managing Risks, Seizing Opportunities
Bisnis

Shipping Industry 2025: Managing Risks, Seizing Opportunities

Mhd. Taufik Arifin ANZIIF (Snr. Assoc) CIIB
By Mhd. Taufik Arifin ANZIIF (Snr. Assoc) CIIB
Published Thursday January 9th, 2025
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Table of Content
Portrait of the Shipping Industry in IndonesiaStatistics and DataMajor Opportunities in 2025Profitable Global TrendsSupporting IndustriesChallenges that must be overcome in the Indonesian shipping industryImproving Vocational EducationThe Role of Technology and Innovation in the Indonesian Shipping IndustryThe Important Role of Risk Management and Insurance Guarantees in the Shipping Industry in IndonesiaThe importance of using the services of an experienced insurance broker

Liga Asuransi – Ship owners, shipowners, ship operators and forwarders, how are you? May your business continue to be successful and smooth. The year 2025 has just begun, bringing new opportunities as well as challenges that need to be anticipated, especially in terms of risk management and insurance. This article reviews strategies to take advantage of opportunities and overcome risks in the shipping industry next year. If you find this article useful, don’t hesitate to share it with your colleagues and business partners.

Indonesia, as the largest archipelagic country in the world, has more than 17,000 islands stretching from Sabang to Merauke. With a coastline of 108,000 kilometers, Indonesia is one of the countries with the largest maritime potential in the world. Its strategic position on international shipping lanes, connecting the Indian Ocean and the Pacific Ocean, makes Indonesia a major crossing point in global trade. This country has more than 2,000 ports, with several strategic ports such as Tanjung Priok, Tanjung Perak, and Makassar which continue to develop to meet trade and logistics needs.

2025 is predicted to be an important point for the Indonesian shipping industry. Government programs such as increased investment in maritime infrastructure provide a significant impetus to strengthen inter-island connectivity and improve logistics efficiency. In addition, global trends such as the demand for environmentally friendly ships (green shipping) and smart ships create great opportunities for Indonesia to compete in the international market.

However, this opportunity does not come without challenges. To become a key player in the global shipping industry, Indonesia must make optimal use of this momentum. Strengthening the shipbuilding sector, improving the quality of the workforce and technological innovation will be the keys to success. By overcoming challenges and taking advantage of opportunities, Indonesia can realize its vision as the world’s maritime axis and strengthen its position on the map of the international shipping industry.

 

Portrait of the Shipping Industry in Indonesia

2025 marks an important momentum with various new investments and increased domestic production capacity to support Indonesia’s vision as the world’s maritime axis.

  • Domestic Shipyard Capacity

Indonesia has more than 250 shipyards spread across various regions. However, most shipyards still focus on ship maintenance and repair, with limited ability to build new ships. PT PAL and several other big players have started producing large ships, but their capacity still lags behind countries such as South Korea and Japan.

  • The Role of Domestic and International Shipping

Domestic shipping plays an important role in the distribution of goods between islands, especially in remote areas. The Sea Highway Program has increased the efficiency of domestic logistics, although its implementation has not been optimal. At the international level, Indonesian shipping still faces stiff competition, with many companies using foreign vessels for exports and imports.

  • Contribution to GDP and Employment

The shipping industry contributes around 4% to national GDP, with the potential for greater growth if maritime infrastructure is improved. This sector is also a significant workforce absorber, from shipyards to ship crews, with hundreds of thousands of people dependent on this industry.

 

Statistics and Data

Export-Import via Ship: More than 90% of Indonesia’s international trade is carried out by sea. Major ports such as Tanjung Priok handle around 7.5 million TEU containers annually.

Number of Ship Fleet: Indonesia has more than 30,000 registered ships, but most of them are small vessels for domestic shipping.

Level of Dependence on Foreign Ships: Around 60% of Indonesia’s international trade still uses foreign ships, indicating the need to increase the capacity of the national fleet.

 

Major Opportunities in 2025

Indonesia as an archipelago country faces big challenges in connecting remote areas. The Sea Toll Program, which was launched by the government to reduce price disparities between regions, is a strategic solution in increasing domestic connectivity. This program strengthens regular shipping routes and facilitates logistics distribution to areas that were previously difficult to reach.

In 2025, the Sea Toll Road is projected to further develop with route expansion and an increase in the number of ships. This creates a significant need to build new ships, both for goods and passengers. Government policies that encourage Domestic Content Levels (TKDN) are also a great opportunity for local shipyards to participate in ship production. In addition, this increased connectivity contributes to economic growth in remote areas, creates more efficient supply chains and drives demand for domestic vessels.

 

Profitable Global Trends

As global awareness of sustainability increases, the need for ships based on environmentally friendly energy (green shipping) continues to increase. Ships fueled by LNG, hydrogen and solar energy are now the main focus in the development of shipping technology. Indonesia, with its natural resource potential, can play a role in building environmentally friendly ships, both for domestic and export needs.

The Indonesian government has also set carbon emission reduction targets, which opens up huge opportunities for investment in this sector. The national shipping industry can take a strategic role by adopting green technology in ship construction, both for domestic and international shipping.

Internet of Things (IoT) technology has brought a revolution in the global shipping industry. Smart ships equipped with automatic navigation systems, efficient fuel management and predictive analytics are becoming a new trend in the world of shipping. This trend provides an opportunity for Indonesia to develop advanced technology-based shipyards capable of producing smart ships. In addition, collaboration with global technology companies can accelerate digital transformation in this sector.

 

Supporting Industries

Shipyards, Spare Parts and Maintenance

The shipbuilding industry is not only about building new ships, but also includes ship repair and maintenance, the needs of which continue to increase. This opportunity is strengthened by the high number of fleets that require routine maintenance. On the other hand, the supply of ship spare parts is a sector that has great potential for development, considering that many raw materials are still imported.

Increasing domestic shipbuilding capacity, supported by government policies, paves the way for Indonesia to reduce dependence on other countries. With this initiative, the local shipbuilding sector can grow to become an important part of the global supply chain.

Role in Global Supply Chains

Indonesia has a strategic role in the global supply chain, especially in the energy and mineral sectors. Indonesian ports are often the main transit point for exports of coal, palm oil and nickel. With increasing global demand, especially from China and India, the need for cargo ships and tankers is expected to continue to increase. This role provides a great opportunity for the national shipping industry to meet the needs of the international market.

Small Ship Exports to Developing Countries

The export market for small vessels, such as medium-sized passenger and cargo vessels, shows great potential, especially in developing countries in Southeast Asia and Africa. Many countries in the region need ships for domestic transportation, but do not have their own production capacity.

Indonesia can take advantage of this opportunity by offering high quality ships at competitive prices. Local shipyards’ experience in building domestic ships can be adapted to meet the needs of international markets. Apart from that, good bilateral relations with these countries can speed up export market access.

 

Challenges that must be overcome in the Indonesian shipping industry

Internal Challenges

Regulations and Bureaucracy That Hamper Efficiency

The Indonesian shipping industry is often hampered by complex regulations and convoluted bureaucracy. The process of licensing ship construction, procuring spare parts, and transporting goods often takes a long time. Incompatibility between central and regional regulations also worsens the situation, resulting in uncertainty for industry players. This reduces Indonesia’s competitiveness compared to other countries that have simpler regulatory processes.

Lack of Skilled Labor in the Field of Shipbuilding and Shipbuilding Technology

The availability of skilled labor remains a big challenge. Most of the workforce in shipyards do not have sufficient skills to operate advanced technologies such as IoT and automation which are now becoming global standards. Vocational education that is relevant to industry needs is also not optimal, thus creating a gap between needs and the capacity of the available workforce.

Dependence on Imports of Raw Materials and Technology

Most of the raw materials for ship construction, such as steel and electronic components, are still imported from other countries. This increases production costs and makes Indonesian shipyards less competitive in the global market. Additionally, reliance on foreign technology poses risks to the sustainability of the industry, especially if there is disruption to global supply chains.

External Challenges

Indonesia faces stiff competition from countries that have long dominated the shipping industry, such as China, South Korea and Japan. These countries have more advanced technology, large production capacities, and lower production costs. These advantages make their products more popular in the international market, making it difficult for Indonesia to compete directly.

Unstable fuel prices are a big challenge for ship operators in Indonesia. Fuel costs can reach 40–50% of the total operational costs of a ship. These fluctuations not only affect the profitability of shipping companies, but also national logistics costs, which ultimately have an impact on the competitiveness of Indonesian products in the global market.

Strategies for Overcoming Challenges

The government needs to simplify regulations and speed up bureaucratic processes in the shipping industry. Digitizing the licensing process can be a solution to increase transparency and efficiency. Apart from that, synchronizing policies between central and regional governments must be prioritized to create a more conducive business ecosystem.

 

Improving Vocational Education

Investment in vocational education specifically for the shipping industry is essential. The government can partner with shipbuilding companies and educational institutions to create curricula that are relevant to industry needs. Workforce training that focuses on advanced technologies such as automation and IoT will improve the quality of the local workforce.

Collaboration with Foreign Investors

Strategic cooperation with foreign investors can help Indonesia overcome challenges in terms of technology and raw materials. Foreign investors not only bring capital, but also transfer the technology needed to increase local production capacity. Public-Private Partnership (PPP) schemes can be an effective approach to attract this investment.

 

The Role of Technology and Innovation in the Indonesian Shipping Industry

Digitalization is the main pillar in the transformation of the modern shipping industry. The application of technology such as the Internet of Things (IoT), big data and artificial intelligence (AI) can increase the operational efficiency of ships. IoT enables real-time monitoring of vessel condition, fuel consumption and engine performance, thereby reducing operational costs and minimizing the risk of accidents.

In addition, big data can be used to analyze shipping patterns, helping to plan more efficient and energy-saving routes. Blockchain technology also has great potential in increasing logistics transparency, enabling more effective and secure supply chain management. Adoption of this technology will help Indonesian shipping companies compete in the global market.

The shipping industry is facing pressure to reduce carbon emissions, so innovation in the use of environmentally friendly energy is an urgent need. Ships fueled by LNG (Liquefied Natural Gas), hydrogen and solar energy are solutions to meet international environmental standards.

Indonesia has a great opportunity to contribute to the development of green energy-based ships, considering its abundant natural resource potential. Investment in green energy technology also supports the government’s target to reduce carbon emissions, while strengthening the competitiveness of the national shipping industry.

Research and Innovation Collaboration

Collaboration between universities, research institutions and the shipping industry is very important to encourage technological innovation. Universities can become research centers for the development of new technologies, such as smart ship designs and automatic navigation systems.

The government can also play a role by providing funding for maritime research and creating a conducive innovation ecosystem. With strong collaboration, Indonesia can become a pioneer in shipping technology in the Southeast Asia region.

 

The Important Role of Risk Management and Insurance Guarantees in the Shipping Industry in Indonesia

The shipping industry in Indonesia, as the backbone of national and international logistics, faces various complex operational risks. From ship accidents, cargo damage, to legal liability towards third parties, all of this requires careful risk management and adequate insurance support.

Risk Management in Shipping

Risk management in shipping includes identification, analysis and mitigation of potential risks that may affect shipping operations. Risks such as extreme weather, navigation on busy trails, or mechanical failure can cause significant financial losses. This process helps ship operators to prepare preventative measures, such as choosing safe routes, carrying out regular inspections, and ensuring ships meet international safety standards.

Insurance Guarantee for Shipping

  1. Insurance plays a central role in protecting a shipping company’s assets and operations. Some relevant insurance products include:
  2. Marine Hull Insurance: Covers damage to or loss of ships due to accidents.
  3. Marine Cargo Insurance: Guarantees the safety of goods transported, both at sea and on land.
  4. P&I Insurance (Protection and Indemnity): Handles legal responsibilities towards crew members, passengers or third parties.
  5. Freight Liability Insurance: Protects carriers against loss claims due to delays or damage to cargo.

Structured risk management and comprehensive insurance coverage are the foundations for the sustainability and competitiveness of the shipping industry in Indonesia. With good risk management, shipping companies can minimize potential losses and maintain operational stability, while supporting the growth of a stronger and safer maritime sector.

 

The importance of using the services of an experienced insurance broker

In a complex industry like shipping, having the right insurance coverage is crucial to maintaining business continuity. However, managing risk and selecting appropriate insurance products is not a simple task. This is where the role of an experienced insurance broker becomes very important.

L&G Insurance Broker is a trusted partner with more than 18 years of experience in the insurance industry, especially in the maritime and shipping sectors. We understand that every company has unique needs. With a consultation-based approach, we help clients identify specific risks, customize insurance coverage, and ensure optimal protection within budget.

Our advantages include:

  • Wide Network: L&G has strong relationships with various national and international insurance companies, enabling us to offer the best products at competitive premiums.
  • Technical Expertise: Our team has deep expertise in Marine Cargo, Marine Hull and P&I Insurance, ensuring maximum protection for your fleet and cargo.
  • Claims Support: We help process claims quickly and transparently, so you can focus on business operations without interruption.

With L&G Insurance Broker, you not only get insurance protection, but also a strategic partner who is committed to supporting the success of your business. Entrust your insurance needs to us and make L&G part of your risk management solution.

Conclusions and Recommendations

The shipping industry in Indonesia has great potential to become a driving force for the national economy and a key player in the global market. With its wealth of maritime resources and strategic position as an island nation, the growth opportunities in 2025 are very promising. However, various internal and external challenges such as complex regulations, limited skilled labor, and global competition must be overcome through appropriate strategies.

To support this growth, risk management and comprehensive insurance coverage are crucial elements. Using the services of an experienced insurance broker such as L&G Insurance Broker can provide appropriate solutions for risk management and asset protection.

Recommendation:

  1. The government must encourage regulatory reform and investment in vocational education.
  2. Industry players need to collaborate with competent insurance brokers to ensure business continuity amidst global challenges.
  3. With this step, the Indonesian shipping industry is ready to explore opportunities in 2025.

For all your insurance needs, Contact L&G Insurance Brokers Today!

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HOTLINE L&G 24 JAM: 0811-8507-773 (CALL – WHATSAPP – SMS)

website: lngrisk.co.id

Email: customer.support@lngrisk.co.id

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TAGGED:bisnis perkapalanindustri perkapalanmarine business
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ByMhd. Taufik Arifin ANZIIF (Snr. Assoc) CIIB
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Taufik Arifin has more than 30 years of experience in the insurance brokerage industry. He holds the Australian New Zealand Insurance and Financial Institution (ANZIIF snr.assoc) CIP and Certified Indonesian Insurance Broker (CIIB) certificates. Please follow the author's Instagram to get to know him better: @taufik.arifin.31
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