Council questions authorities' license to Carrefour

Council questions authorities' license to Carrefour

JAKARTA (JP): The city council questioned on Wednesday the
city administration's decision to grant licenses to the giant
Carrefour hypermarket chain.

Chairman of Commission B for economic affairs at the city
council Syarief Zulkarnaen Ginting said the presence of the
French chain, now numbering seven outlets in strategic locations
across the city, posed a major threat to small retailers.

Rather than questioning related agencies at the
administration, he and his colleagues from the commission would
make an "impromptu visit" to the new Carrefour outlet on Jl. MT
Haryono in South Jakarta next Tuesday for further clarification
about the matter.

Syarief did not say why he had chosen to disclose the date of
the visit to the press.

According to the commission, he said, hypermarkets were not
allowed to operate in the center of the capital, but only on its
outskirts.

The Association of Indonesian Retailers imposed retail zone
restrictions in 1999.

However, Carrefour has been permitted by the city
administration to open outlets.

Moreover, Carrefour should have obtained a license as a
wholesaler, not a retailer, the United Development Party
councillor said.

"The hypermarket should have a license to sell basic goods at
wholesale not retail prices.

"They offer these goods at wholesale prices which threatens
the survival of small retailers and traditional markets here,"
Syarief said.

The city council, he said, had received several complaints
from small retailers about declining revenues due to the presence
of Carrefour outlets in the past two years.

"Many other hypermarkets sell basic goods in bigger quantities
and not at retail prices. So it is weird if Carrefour can offer
these items at retail prices," he added.

Carrefour representatives were unavailable for comment on
Wednesday.

A legal management staffer told The Jakarta Post that he was
willing to explain but had no authority to deal with the media.

He then referred the matter to Trijono Prijosoesilo from the
business development division of the company.

But Trijono could not be reached until late Wednesday.

Carrefour opened its first outlet in Cempaka Putih, Central
Jakarta, in 1998, just a few months after its rival, Continent,
also from France, inaugurated its first outlet on the main
thoroughfare of Jl. Rasuna Said.

In 1999 the two hypermarkets merged. In Indonesia the company
is jointly managed by PT Contimas Utama Indonesia, PT Carti
Satria Megaswalayan and PT Cartisa property Indonesia.

The new Carrefour currently operates seven outlets in Jakarta,
including those at Duta Merlin business complex in Harmoni,
Cempaka Mas business district, both in Central Jakarta, Ratu
Plaza shopping center in South Jakarta and Pluit Megamall in
North Jakarta.

Syarief said his commission would also seek clarification
about the use of the land at Carrefour outlet on Jl. MT Haryono,
which actually belonged to the Indonesian Air Force and was not
to be used for business purposes.

"We are the representatives of the people and the public are
threatened by the presence of these hypermarkets. Even if the
government has already provided them with licenses, we should ask
for further clarification if they are causing losses to the
public," said the councillor.

"We really want more foreign investors to come to the city but
not in a way that jeopardizes the survival of local small
entrepreneurs and traditional markets," Syarief remarked. (dja)