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Thu, 10 Oct 1996

JP/Ericsson to set up facility in Indonesia

Ericsson to set up facility in Indonesia

JAKARTA (JP): The Swedish telecommunications group LM Ericsson AB plans to set up in Indonesia a facility to provide software for the development of telecommunications equipment, said the company's top executive.

Ericsson's president, Lars Ramqvist, told reporters here yesterday that Ericsson's investment in Indonesia had begun with the training of Indonesian personnel because his party must trust local people and what the company could do is to transfer technology.

"We have the ambition to develop a software facility in Indonesia. Currently, Ericsson has 65 factories globally," he said. "Some of the facilities, which include research and development centers, are located in Singapore, Japan, China, Australia, Malaysia, Thailand and India. This should also include Indonesia."

He said that Ericsson, through its marketing arm PT Ericsson Indonesia, had netted US$500 million in contract orders in Indonesia this year.

"If we have business worth $500 million per annum, which is expected to increase next year, we need to be here because of customers."

He refused to give further details of the planned software facility in Indonesia.

Ramqvist was here to attend the opening of Ericsson Indonesia's new office at Pondok Indah, South Jakarta. Ericsson Indonesia is 95 percent owned by Ericsson and 5 percent by Ericsson Indonesia's commissioner A. Fawzy Siddik.

During his visit, Ramqvist also held meetings with Minister of Tourism, Post and Telecommunications Joop Ave and State Minister of Research and Technology B.J. Habibie.

Ericsson gained better-than-expected earnings in the first half of this year, while its pretax profit rose 31 percent to 4.22 billion krona ($640 million), on account of strong sales.

In the corresponding period of last year, Ericsson posted a profit of 3.21 billion krona.

Ericsson, which began its business in Indonesia in the 1900s, has a number customers in the country, including state-owned PT Telkom, PT Pramindo Ikat Nusantara, PT ACeS and PT Mitra Global Telekomunikasi Indonesia. (icn)