Govt pledges to help ailing export companies<\/p>\n
JAKARTA (JP): The government has pledged to assist ailing
\nexport companies procure raw materials and strengthen their
\nworking capital.<\/p>\n
Minister of Industry and Trade Tunky Ariwibowo said yesterday
\nmany export companies faced bankruptcy as letters of credit
\nissued by Indonesian banks were often rejected by foreign banks.<\/p>\n
The minister, however, declined to elaborate on the planned
\naid package. He only promised that it would be announced soon.<\/p>\n
\"I cannot say when, but it will be announced in a very short
\nperiod of time, because this problem needs a quick solution,\"
\nTunky said after meeting with President Soeharto at his private
\nresidence on Jl. Cendana, Central Jakarta.<\/p>\n
He cited the shoe, textile and electronics industries as the
\nsectors suffering most because many of their raw materials must
\nbe imported.<\/p>\n
\"The shoe industry, for example, still imports 50 percent of
\nits components. The textile sector is also facing similar
\nproblems,\" said Tunky.<\/p>\n
He said many electronics companies here were subsidiaries of
\noverseas firms which could rescue the companies.<\/p>\n
Bank Indonesia, the central bank, provided a low interest rate
\nswap facility to export-oriented companies in January. The rate
\noffered was 1 percent lower than market interest rates.<\/p>\n
The central bank said the swap facility was essential to
\nensure that exporters could obtain U.S. dollars to finance their
\nraw materials.<\/p>\n
However, many exporters have complained that only companies of
\nlarge groups with their own banks were able to use the facility.<\/p>\n
\"Specifically, export-oriented national companies which do not
\nhave any link or affiliation with a foreign company will deserve
\n(to use the new facility),\" Tunky said about the recipients of
\nthe new package.<\/p>\n
Singapore Prime Minister Goh Chok Tong proposed a multilateral
\nsystem of guarantees for Indonesian letters of credit during a
\nFeb. 3 meeting with Soeharto.<\/p>\n
Tunky promised he would report the progress of the plan to
\nSoeharto in about two weeks.<\/p>\n
\"This plan needs more time. We have to take quick measures,
\nespecially for companies which need to import raw materials.\" he
\nsaid. (prb)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-pledges-to-help-ailing-export-companies-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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