Apkomindo calls for import tariff cuts

The Jakarta Post, Jakarta

In an attempt to encourage Indonesians to assemble more computers in Indonesia, the government must cut import tariffs on computer components, the Indonesian Computer Entrepreneurs Association (Apkomindo) said Wednesday.

Apkomindo chairman Hidayat Tjokrodjojo said current tariffs of between 5 percent and 20 percent on imported components discouraged players from making new local brands.

"Computer assembly is not popular here yet due to the high tariffs on imported components," he told The Jakarta Post after the opening of a five-day computer exhibition.

The government does not impose tariffs on imported computer sets, Hidayat said.

"The different tariffs on computer sets and computer components have driven industry players to import computers, rather than assemble them here."

Hidayat said the prices of domestically assembled products, known as generic computers, were about 20 percent cheaper than imported sets.

"That is because generic computers do not need much money for marketing."

Among the generic computers sold with national brands are Zyrex, Mugen and Reliant. Others have no brand names.

The association predicted computer sales to increase by 20 percent this year to 720,000 units.

The expected increase in sales was due to the strengthening of the rupiah against the U.S. dollar.

The implementation of e-government by some provincial administrations is expected to support the increase in computer sales this year.

E-government is a breakthrough for regional administrations to promote their services as communication can be conducted online. People can also get basic information about their regions.

In 2002, the sales of desktop computer sets in Indonesia was estimated at about 600,000 units and laptops at about 60,000.

The association said that branded desktop computers, like Hewlett-Packard and IBM, contributed about 40 percent to last year's sales of desktop computers. Generic brands contributed the remaining 60 percent.