Conglomerates' idea wins support

Conglomerates' idea wins support

JAKARTA (JP): Chairman of the Indonesian Chamber of Commerce
and Industry (Kadin) Aburizal Bakrie welcomed yesterday a
proposal that large companies allocate two percent of their
profits to helping narrow the gap between rich and poor in
Indonesia.

"Good. It's a good idea. I think we should arrange the next
steps and how to undertake it," he said after attending the
official launching of a cellular digital radio telephones (CDRL)
project by Minister of Tourism, Post and Telecommunications Joop
Ave at the Wisma Bakrie building yesterday.

An Indonesian business tycoon, Eka Tjipta Widjaja, suggested
on Tuesday that large and medium-sized businesses with profits of
or exceeding Rp 100 million (US$44,150) per year might contribute
two percent of their profits to finance measures aimed at
narrowing the economic gap.

A number of the country's leading conglomerate owners issued a
declaration in Bali on Sunday in which they said they would
develop business partnerships with small and medium-sized
companies.

According to Aburizal, better known as Ical, Kadin has already
prepared follow-up measures to the declaration.

"A number of Kadin executives met on Tuesday with leaders of
the Prasetiya Mulya foundation to discuss possible partnerships
in certain areas," he said. "I hope that by the end of this year
Kadin will be able to commence certain projects."

Economist I Nyoman Moena said that Eka's proposal was
"noteworthy, because it has been put forward by one of our
leading businessmen."

Moena, a former president of PT Surveyor Indonesia, said the
two percent of profits proposed by Eka should be taken from net
profits, so that it does not reduce the companies' taxable
incomes.

The proposal, however, still requires the support of other
conglomerate owners, Moena said. He suggested that the country's
leading business figures establish a forum to attend to the
realization of the objectives set forth in the Bali declaration.

He added: "If Eka's proposal can be realized, there will be a
large pool of cheap funds which can be used by small and medium-
sized enterprises."

Radio phones

The CDRL project, launched yesterday, belongs to PT Radio
Telephone Indonesia (Ratelindo), a subsidiary of the Bakrie
Group.

Ratelindo is 55 percent owned by PT Bakrie Electronics Company
of the Bakrie Group and 45 percent owned by state-owned domestic
telecommunications operator PT Telkom.

Ratelindo's president, Hardianto Kamarga, said that the
company had allocated some $82 million for the CDRL project,
which includes the installation of 21 base transceiver stations.

The government has licensed the company to install 280,000
CDRL lines, of which 250,000 are to be installed in the greater
Jakarta area and 30,000 in Bandung, West Java.

Ratelindo's CDRL system, the first of its kind in Indonesia,
will use radio frequencies rather than wire cables. Call tariffs
will be the same as those applying to the use of the fixed lines
operated by Telkom. (icn/rid)