Belgian Bekaert defends investment in Indonesia

Belgian Bekaert defends investment in Indonesia

BRUSSELS (Reuter): Belgian steel wire and cord maker Bekaert NV denied on Monday a charge it was trading jobs in Europe against those in Indonesia.

"We are investing in Indonesia not for low labor costs but because the local market for steel cord is developing quickly and if we want a stake in this market we have to produce locally," Bekaert spokesman Willy Snaet said.

"There is a surplus of capacity in Europe. There is no question of us importing back into Europe from Indonesia," Snaet added.

Bekaert was used on Monday by Nobel Peace Prize co-holder Jose Ramos-Horta as an example of a western company investing in Indonesia while shedding jobs at home.

Horta was in Brussels to promote calls for democracy for East Timor, the former Portuguese colony annexed by Indonesia in 1976.

Bekaert said earlier this year it plans to shed around 350 jobs in Belgium as part of a restructuring of its European steel wire and cord operations.

Snaet said the aim was to reduce numbers through early retirement. However, no agreement had yet been reached with unions on terms.

He added the Belgian company's global works council would be presented next Monday with a plan concerning its French operations, but declined to comment on newspaper reports that this involved job cuts.

Last July the company announced plans to invest more than US$50 million in a steel cord plant near Jakarta, which is due to start production this year.