Govt to proceed with plan to raise phone call rates<\/p>\n
JAKARTA (JP): Publicly listed domestic telecommunications
\nprovider PT Telkom has to proceed with a plan to restructure
\ntelephone call rates within Greater Jakarta since this was
\npromised to investors when the government floated shares of the
\ncompany on the stock exchange in 1995, according to Minister of
\nCommunications Giri Suseno.<\/p>\n
He said Telkom's rate restructuring plan was contained in a
\nprospectus issued by the company prior to its initial public
\noffering in November 1995.<\/p>\n
The rate restructuring plan was in line with tourism, post and
\ntelecommunications ministerial decree No. KM.104\/PR.301\/MPP-94,
\nwhich came into force on Jan. 1, 1995.<\/p>\n
"Don't forget that the decree was issued because Telkom had to
\nfulfill certain conditions before going public. This can't be
\ncanceled unilaterally. We have to honor this (the prospectus),"
\nGiri told reporters Friday after installing the new board of
\ndirectors at three state-owned transportation companies.<\/p>\n
The decree stipulates that local rates apply only for calls
\nwithin a range of 30 kilometers. Calls made to areas more than 30
\nkm away are classified as long distance, thereby subject to long
\ndistance rates.<\/p>\n
Giri said Telkom already applied such a rating system in areas
\noutside Greater Jakarta.<\/p>\n
"It's Telkom's duty to socialize the tariff restructuring so
\nthat the public can understand," he said.<\/p>\n
The House of Representatives last month urged the government
\nto cancel the plan to restructure local telephone rates within
\nGreater Jakarta.<\/p>\n
Telkom president Asman A. Nasution told House Commission IV
\nfor transportation and communications that Greater Jakarta had
\nbeen exempt from the tariff restructuring measure because the
\ngovernment wanted to give the area preferential treatment. He
\nalso appealed for understanding that the company had been hurt by
\nthe sharp depreciation of the rupiah against the U.S. dollar.<\/p>\n
He pointed out that the company, which is listed on the
\nJakarta Stock Exchange and New York Stock Exchange, suffered a
\nfirst quarter loss this year. He declined to provide a figure.<\/p>\n
Telkom has raised its rates twice this year, in January and in
\nApril, he said, adding that only the second revision incorporated
\na new exchange rate which was based on Rp 5,000 to the dollar,
\ncompared to Rp 2,400 in July during the precrisis period.<\/p>\n
The rupiah hovered around Rp 13,000 last week.<\/p>\n
Giri also said Telkom and five contractors had reached an
\ninitial agreement to revise joint operation scheme (KSO)
\ncontracts in installing two million fixed lines by the end of
\n1999 and managing them through 2010.<\/p>\n
"They will meet again to finalize details of the revision," he
\nsaid, adding that among the changes would be the lowering of the
\nnumber of lines to be installed and the shared revenue fee for
\nTelkom.<\/p>\n
Under the initial KSO contracts, five joint venture
\ntelecommunications firms were to install new telephone lines
\nstarting 1996 and manage them until 2010 in a revenue sharing
\ndeal with Telkom.<\/p>\n
The foreign KSO investors are France Cables & Radio (to
\ninstall lines in Sumatra), U.S. West International (West Java),
\nTelstra Global of Australia (Central Java), Cable & Wireless of
\nthe UK (Kalimantan) and SingTel of Singapore (eastern part of
\nIndonesia).<\/p>\n
The KSO operations contributed 28 percent to Telkom's
\noperating revenue in 1997.<\/p>\n
The monetary crisis made it difficult for contractors to meet
\nthe contract terms.<\/p>\n
They claimed in April that 50.1 percent of the targeted lines
\nhad been installed by the end of 1997, but Telkom's Asman said
\nonly 25 percent had been installed.<\/p>\n
Telkom is one of 12 state companies to be put on the
\ngovernment's privatization list to help raise US$1.5 billion to
\nfinance the 1998\/1999 State Budget. The government, which at
\npresent holds a 65 percent stake in the telecommunications
\ncompany, plans to make further divestments in its privatization
\nprogram.<\/p>\n
The restructuring of the KSO contracts, however, has to be
\ncompleted first before selling more of the government's stake in
\nthe company, officials said. (rei)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-to-proceed-with-plan-to-raise-phone-call-rates-1447893297",
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