Automo parts export to decline in 2004<\/p>\n
Leony Aurora, The Jakarta Post, Jakarta<\/p>\n
Indonesian automotive component exports are likely to decline
\nthis year as Indonesia's competitiveness in the sector will keep
\nweakening due to the lack of tax incentives and the strengthening
\nof the rupiah against the dollar, says an association.<\/p>\n
Chairperson of the Association of Automotive Component Firms
\nHadi Surjadipraja said on Saturday increasing production costs
\nand Indonesia's higher inflation compared to other countries were
\ncontributing factors in the trend.<\/p>\n
\"We want to export, but we cannot compete,\" said Hadi, adding
\nthat the weakened competiveness had been a phenomena for some
\ntime.<\/p>\n
He noted that the government had provided a tax incentive by
\nallowing automotive component makers to refund import duties for
\nraw materials if they use the imported materials to produce goods
\nfor exports.<\/p>\n
However, in reality, the mechanism is not as simple. If the
\nexports are done through a third party, the import duties cannot
\nbe reimbursed.<\/p>\n
\"Most components producers sell their goods to car
\nmanufacturers, who in turn will export the cars,\" he added.<\/p>\n
Indonesia's automotive component exports have seen a decline
\nsince 2002, when its export value fell to US$629 million from
\n$681 million in 2001.<\/p>\n
\"Although I don't have the specific data yet, I think the
\nexports in 2003 have decreased too,\" he said.<\/p>\n
Alem Pusbowo, operations chief of Astra Otoparts, one of the
\nmain players in the industry, said that he expected Astra's
\nexport value would remain stable this year.<\/p>\n
\"Our market is already set in the Middle East,\" he said,
\nadding that this year, his company was considering the
\npossibility of exporting to South American countries.<\/p>\n
The firm's exports, which account for between 20 percent to 25
\npercent of its total revenue, consist mainly of car batteries.<\/p>\n
Late last year, Director General of the Metal, Machinery and
\nElectronics Industry Subagyo of the Ministry of Industry and
\nTrade had urged local automotive component producers to be more
\nexport-oriented.<\/p>\n
He said that during a visit to the United States last year, a
\nministerial delegate found that the large U.S. component market
\nneeded a lot of supplies.<\/p>\n
To develop and boost performance of the Indonesian automotive
\ncomponent industry, Subagyo said the government invited experts
\nfrom Japan every year to give training to workers in the
\nindustry.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/automo-parts-export-to-decline-in-2004-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}