The Development of Ship Recycling Facility Cluster in Indonesia

Abstract

With a number of 80.849 units ship operating in Indonesia, the Ministry of Transportation estimates that 29,944 units ship of those vessels have been in service for more than 20 years. Furthermore, recycling ships are necessary. Ship Recycling Facility (SRF) should be ecologically friendly following International Maritime Organization (IMO) policy under the Hong Kong International Convention. Docks, cranes, steel cutters, and warehousing are necessary. SRF facilities, along with ecologically suitable hazardous material treatment. If this facility became a cluster, it would operate more effectively. This study aims to provide a different area in Indonesia where a prospective SRF cluster could grow. This research uses Diamond Porter’s method to determine a country’s comparative economic advantage towards the SRF cluster in Alang City, Gujarat, India, which is the global leader in ship recycling. The factor conditions; related and supporting industries; demand conditions; and firm strategy, structure, and rivalry are all examined in this study. To accommodate ship owners, the SRF business, and the government in carrying out ship recycling, the results of this study are a reference for formulating specific regulations for the SRF cluster. This research found that Kamal and Bojonegara are viable for the SRF cluster.