'Car policy shouldn't discriminate'<\/p>\n
JAKARTA (JP): Japanese Prime Minister Ryutaro Hashimoto
\nyesterday expressed his support for Indonesia's plan to develop
\nan automotive industry, but insisted the development should not
\ndiscriminate against foreign car manufacturers.<\/p>\n
The issue of Indonesia's much criticized national car project,
\ncropped up in a 90-minute meeting between Hashimoto and President
\nSoeharto at the Merdeka Palace yesterday.<\/p>\n
A senior Japanese foreign ministry official said Hashimoto
\ntold Soeharto how Japan had developed its automotive industry.<\/p>\n
\"In the past, Japan in developing its auto industry (also)
\nprovided special treatment... under certain conditions...However
\nthese policies did not discriminate against foreign auto makers,\"
\nsaid the official who asked not to be named.<\/p>\n
Despite the contentious nature of this issue, the talks
\nremained amiable.<\/p>\n
Under Indonesia's national car policy, PT Timor Putra Nasional
\n-- a firm controlled by Soeharto's youngest son Hutomo Mandala
\nPutra -- is exempt from the import duties and luxury taxes which
\nusually add 60 percent to the price of a car.<\/p>\n
This exclusive policy allows PT Timor to import cars from
\nSouth Korea's Kia Motors tax free until 1998 after which the
\nIndonesian firm's factory is expected to become operational.<\/p>\n
PT Timor, with the help of Kia, will then produce cars with a
\n60 percent local content.<\/p>\n
The policy has been criticized by Japan, the European Union
\nand the United States who complained about the discriminatory
\ntreatment to the World Trade Organization (WTO).<\/p>\n
Japanese car makers have much at stake since they hold a 90
\npercent share of the Indonesian automobile market.<\/p>\n
The Japanese official said Hashimoto told Soeharto that Japan
\nhad no objection to Jakarta encouraging the development of its
\nauto industry.<\/p>\n
\"However this had to be done in a manner consistent with WTO
\nrules,\" the official said again quoting Hashimoto.<\/p>\n
Hashimoto arrived Thursday for a three-day state visit as part
\nof his five-nation tour of Southeast Asia which includes Brunei,
\nMalaysia, Vietnam and Singapore.<\/p>\n
The national car policy was apparently brought up by Soeharto.<\/p>\n
Indonesian Minister\/State Secretary Moerdiono said Soeharto
\nwanted to brief Hashimoto on the background to the policy.<\/p>\n
\"The president explained that making the national car in
\ncooperation with South Korea was not necessarily discriminative
\nto other countries,\" Moerdiono said without really explaining
\nhimself.<\/p>\n
He said it was a question of national interest and the option
\nof creating a national car with Korea was the only one open.<\/p>\n
Neither Indonesian nor Japanese officials would say whether
\nthe two leaders touched on possible solutions or if there was a
\npossibility of a Japanese firm receiving the same privileges in
\norder to allay Tokyo's protests.<\/p>\n
Moerdiono only said discussions remained very warm and both
\nleaders agreed the issue would not harm the strong bilateral
\nties.<\/p>\n
Separately the head of the Indonesian Automotive Industry
\nAssociation, Herman Latief, yesterday expressed hope the issue
\nwould be settled amicably.<\/p>\n
He said despite the contrasting positions, the dispute should
\nnot unsettle the overall framework of cooperation in other
\nfields.<\/p>\n
As Indonesia's biggest trading partner, largest investor and
\ndonator of aid, Japan is of high strategic importance.<\/p>\n
Both leaders said they were pleased with the current state of
\nrelations.<\/p>\n
On regional issues, Hashimoto conveyed his desire for a
\ndeepening of ties between Japan and the Association of Southeast
\nAsian Nations (ASEAN) of which Indonesia is a founding member.<\/p>\n
Soeharto reacted positively to the idea of a Japan-ASEAN
\nsummit and said it would be discussed with other ASEAN leaders
\nlater this year.<\/p>\n
Hashimoto also touched on the impending entry of Myanmar into
\nASEAN. He said he hoped Myanmar's inclusion would be conducive to
\nprogressive change by Yangon.<\/p>\n
However the Japanese prime minister also said ASEAN should not
\nbe used as a cover for oppression by Yangon.<\/p>\n
Hashimoto departs Jakarta for Hanoi this morning. (mds)<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/car-policy-shouldnt-discriminate-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }