Import activities drop 80 percent: Ginsi<\/p>\n
JAKARTA (JP): The Indonesian Importers Association (Ginsi)
\nsaid yesterday that import activities had dropped more than 80
\npercent over the last few months.<\/p>\n
Association chairman Amirudin Saud said the sharp drop in
\nimports, which totaled US$41.67 billion last year, was caused by
\nthe refusal of most Indonesian letters of credit (L\/C) by foreign
\nbanks.<\/p>\n
Moreover, most local banks, which are suffering from a
\nliquidity crisis, require importers to pay up front the full
\namount of the L\/Cs they want to open, Amiruddin added.<\/p>\n
\"Most of the remaining import activities now are based on the
\ntrust built from long-term relationships between buyers and their
\nforeign partners, which allow transactions without L\/Cs,\"
\nAmirudin told reporters at his office.<\/p>\n
Latest official data showed total imports declined by 35.2
\npercent in March to US$2.37 billion compared to those in the same
\nmonth of last year.<\/p>\n
Since the monetary crisis hit the country and shook the
\nbanking sector, most L\/Cs issued by local banks have been turned
\ndown by overseas banks.<\/p>\n
Amirudin said some companies, which have had business
\nrelationships with foreign companies for as long as 20 years,
\nwere allowed to import goods without L\/Cs under credit payments
\nof up to six months.<\/p>\n
\"In some cases, foreign partners deal in raw materials which
\ncannot be kept for too long so that they often don't have much of
\na choice but to sell to the Indonesian importers, even without an
\nL\/C,\" he said.<\/p>\n
Commodities which are still being imported include chemical
\nmaterials, textiles and medicines.<\/p>\n
Importers unable to continue their activities have simply
\ndeposited their funds at local banks to earn high interests for
\npaying order to pay their workers, he said.<\/p>\n
A foreign businessman, whose company supplies iron and steel
\nto Indonesia, complained yesterday that he had yet to receive
\npayments from Bank Danamon, which issued the L\/Cs for his goods.<\/p>\n
Since Danamon's management was taken over by the Indonesian
\nBank Restructuring Agency (IBRA), the agency has not paid any of
\nits debts, said the businessman, who asked for anonymity.<\/p>\n
IBRA is supposed to meet all business obligations of the banks
\nput under its supervision.<\/p>\n
\"IBRA has made promises but has given no solid dates.
\nMeanwhile, nobody who has claims on IBRA has been paid,\" he said.<\/p>\n
\"How do you expect creditors to supply more goods, if we do
\nnot even know when we'll get paid?\" he said.<\/p>\n
Commenting Soehardjo's resignation last week as the director
\ngeneral of customs and excise, Amirudin called on the government
\nto appoint a new head from the ranks within customs and excise
\noffice.<\/p>\n
\"We heard that Minister of Finance Bambang Subianto will
\nappoint someone from outside the customs service to replace
\nSoehardjo,\" Amirudin said, referring to reports that Martiono
\nHadianto, former director general of state-owned companies, would
\nreplace Soehardjo.<\/p>\n
Amirudin warned the government against repeating its past
\nmistakes of placing an \"outsider\" to the top position at the
\ncustoms and excise office.<\/p>\n
From 1970 to 1991, all the directors general were appointed
\nfrom outside, causing disorder in the system, he said.<\/p>\n
Soehardjo, a brother-in-law of former president Soeharto,
\nresigned Friday, saying he was not capable of speeding up reform
\nand modernization in the customs and excise office. (das)<\/p>",
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