BPEN pessimistic on government's 2001 export target

JAKARTA (JP): The National Agency for Export Development (BPEN) said on Thursday the government's 2001 non-oil and gas export target of US$51.3 million would be difficult to meet given the weak export performance in the first five months of the year.

BPEN chairman Gusmardi Bustami said non-oil and gas exports between January and May decreased by 0.09 percent to $18.6 billion, compared to the same period last year.

"Frankly speaking, it will be hard to achieve the non-oil and gas export target for this year," he said during a media conference on the preparations for the 2001 Export Products Expo, or 2001 PPE.

He said his pessimism was also based on the fact that export orders, which customarily are made six months in advance, were now mainly made between only one or two months in advance due to political uncertainty and the country's security problems.

The government has said it expects 2001 non-oil and gas exports to increase by 7.5 percent to $51.3 billion from $47.7 billion last year.

But Gusmardi said the economic slowdown in the U.S. and political instability at home had negatively impacted the country's export industry.

"Non-oil and gas exports may increase but not by (7.5 percent)," he added.

Gusmardi said he hoped new President Megawati Soekarnoputri could bring stability to the country, an important element needed to boost exports.

"If stability continue to exist, I have no doubt that the rupiah will be stronger ... that's good for export industry," he said.

The rupiah has soared to a five-month high of about Rp 9,775 per U.S. dollar following the appointment of the country's new President.

Gusmardi said the stronger rupiah would help reduce exporting companies' costs, because most of their raw materials and machinery were imported.

For example, textile companies import 70 percent of their raw materials, footwear firms 70 percent and electronics companies 80 percent, he said.

He also hoped a more positive situation in the country would be followed by lower interest rates, which would enable companies to repay debts and receive loans at more affordable rates.

A turnaround in the U.S economy would also help Indonesia's exports, he said.

Meanwhile, Gusmardi said the 2001 PPE, which will be held from October 24 to October 28 at the Jakarta Fairgrounds in Kemayoran, had received a positive response from both the country's exporting firms and foreign buyers.

He said about 1,191 producers and 879 foreign buyers had confirmed that they would take part in the expo.

"We're optimistic that 1,241 firms and 6,000 foreign buyers will participate in this expo," he said, adding about 4,800 buyers took part at last year's expo.

Companies at the expo will display such items as furniture, handicrafts, textiles, footwear, foods and beverages, and leather, metal and rubber products.

"We expect that the transactions at this year's expo will increase by between 15 percent and 20 percent to $120 million from $103 million last year," Gusmardi said.

He guessed that furniture, handicrafts, wood products, electronics and leather products would dominate the transactions at the expo.(05)