Fiber optic companies urge government to lower tariffs

JAKARTA (JP): The country's fiber optic manufacturers have been complaining about the high import duty on raw materials, urging the government to set lower tariffs to accelerate the industry's progress.

President of fiber optic company PT Siemens Kabel Optik, Peter Djatmiko, said here yesterday there were currently four fiber optic manufacturers operating in Indonesia but they had to pay higher duties on their raw materials than those imposed on imported fiber optics.

"Currently fiber optic makers have to pay between 30 percent and 40 percent import duty on the raw material. The import duty for fiber optic is just 5 percent," he said.

Djatmiko also called on the government to monitor the volume of imported fiber optics in Indonesia as the production capacity of the country's fiber optic producers was sufficient to fulfill the domestic demand.

The four fiber optic makers in Indonesia currently have a total capacity of 584,000 single-corn kilometers (sckm), much more than the domestic demand which totals 250,000 sckm, he claimed.

Four more fiber optic producers would start operation next year, he added.

"Many telecommunications companies, which are partly owned by overseas companies, prefer buying fiber optics from their own home countries. Some of them have also created their own prerequisites and specifications to make domestic fiber optic producers unable to compete with the foreign suppliers," he said.

The government and state-owned PT Telkom have actually set official standards, he added.

According to Djatmiko, such problems should not have arisen because the Directorate General of Post and Telecommunications, has issued type-approval for any telecommunications systems and equipment to be installed in Indonesia.

Based on data from the Association of Indonesian Cable Producers, last year Indonesia imported fibers, mostly fiber optics, worth US$271 million, up by 35 percent from 1995.

"These imports should have cut into the country's foreign exchange reserves," Djatmiko said.

Many users of imported fiber optics claimed that the local products cost more and were of inferior quality.

"That's not true. We are competitive in prices," Djatmiko said.

He said that PT Siemens Kabel Optik (SKO), for example, had won an ISO 9002 certificate from KEMA of the Netherlands. SKO is 49 percent owned by PT Trafindo Perkasa of the Ometraco Group and 51 percent by Siemens AG of Germany.

He reiterated that the local fiber optic makers only needed the opportunity. "It'll be much more efficient if the fiber optic users in Indonesia use local products." (icn)