Computer sales projected to equal last year's figures

JAKARTA (JP): The strengthening of the rupiah against the U.S. dollar, coupled with the government's new tax policy, may spur sales of computers for the next six months, but the initial growth target of 20 percent for this year is unlikely to be reached, an association executive said.

Chairman of the Indonesian Computer Dealers Association (Apkomindo) G. Hidayat Tjokrodjojo said on Saturday that computer sales for this year would at best equal last year's sales of 400,000 units, if the rupiah continued to strengthen.

The association initially targeted this year's sales at 480,000 units.

He said computer sales between January and June this year only reached 150,000 units due to the weakening rupiah during the period.

The rupiah has strengthened since the election of President Megawati Seokarnoputri. The currency closed at Rp 9,500 on Friday. It was above the Rp 11,000 mark prior to the election of Megawati.

Hidayat noted that corporate buyers usually increased their spending for computers in the second half of the year, adding that the new school year in July also usually prompted more sales.

He said he hoped the new Cabinet led by Megawati would manage to keep Indonesia's political as well as economical situation stable as this would help stabilize the rupiah.

"Rupiah fluctuation is computer dealers' worst nightmare," Hidayat said, noting that more than 80 percent of the computer components in a personal computer (PC) are still imported.

Hidayat also said the scrapping of the 20 percent luxury tax on computers in July also encouraged more people to buy computers.

The tax, which was introduced by the government in January this year, sparked protests from the industry.

Sales reached a peak of 392,000 units in 1997, then plunged to 74,000 units the following year. In 1999, sales increased to 279,000 units.

"When the government imposed the 20 percent luxury tax, we estimated sales to drop 20 percent to about 320,000 this year," he said.(tnt)