Timor can be 'converted into a state firm'<\/p>\n
JAKARTA (JP): Minister of Trade and Industry Rahardi Ramelan
\nsaid here on Thursday that PT Timor Putra Nasional could be taken
\nover and converted to a state firm if the controversial car
\nproducer did not settle its debt with the government.<\/p>\n
\"If the government confiscates the company's assets, the
\ncompany must continue operating. The government could run it as a
\nstate company or sell it to private investors,\" he said after
\nattending a House of Representatives plenary session on the
\nantimonopoly bill.<\/p>\n
Taking over the company and converting it to a state company
\nwould preserve the company's assets, he said, adding that the
\nfinal decision on whether the government would take over the
\ncompany would be made by the finance minister.<\/p>\n
According to the Directorate General of Customs and Excise, PT
\nTimor missed the Dec. 18 deadline to pay Rp 3.09 trillion (US$412
\nmillion) in backdated import duties.<\/p>\n
Timor was given until Dec. 18 to pay backdated import duties
\nwhich the company had been originally exempted from paying under
\nspecial facilities extended by the government.<\/p>\n
PT Timor, owned by Soeharto's youngest son Hutomo (Tommy)
\nMandala Putra, was served with a letter of warning giving it 14
\ndays to settle its dues. If the money is not paid within 14 days,
\nthe company's assets will be seized and transferred to the State
\nReceivership Agency.<\/p>\n
In 1996, Timor Putra was awarded the rights to develop a
\nnational car by then president Soeharto. The company was given an
\nexemption from import duties and tax exemptions to import
\nassembled sedans manufactured by South Korea's Kia Motor Co.<\/p>\n
The exemptions were granted on the condition that the company
\nestablish an assembly plant in Indonesia in its second year of
\noperations and gradually increase the use of locally manufactured
\nautomotive components.<\/p>\n
The company failed to fulfill the terms of the agreement and
\nis now required to pay backdated tax and import duties on the
\n40,960 cars it has so far imported.<\/p>\n
The national car program, according to Attorney General Andi
\nM. Ghalib, was made possible because of the collusion of Soeharto
\nand government officials.<\/p>\n
Japan, the European Union and the United States filed a
\ncomplaint against Indonesia with the World Trade Organization in
\nGeneva last year and won a ruling in their favor.<\/p>\n
Rahardi said that United States automotive giant Ford
\nannounced plans to expand its business in Indonesia during his
\nvisit in the U.S. earlier this month.<\/p>\n
\"Ford representatives will come to Jakarta soon to look into
\nthe possibility of making a big investment here. The company
\nwants to expand its role in Indonesia's automotive industry,\" he
\nsaid.<\/p>\n
He said that Ford planned to invest here earlier, but the move
\nwas canceled because of the U.S. government's opposition to
\nIndonesia's national car program.<\/p>\n
\"So they have decided to come back after seeing that we have
\nsettled the problem satisfactorily.\" (gis)<\/p>",
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"sponsor": "Okusi Associates",
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