Financing urged for exporters

Financing urged for exporters

JAKARTA (JP): The government should provide more export financing incentives to drive sagging non-oil exports, an official said.

Chairman of the National Agency for Export Development Rudy Lengkong said last week that Indonesia is far behind other countries with the same level of development in providing export financing facilities to exporters.

"I don't see better prospects for Indonesian exports unless the government is willing to provide more financial facilities for exports.

"It seems to me that the government provides more financial facilities to developers," Lengkong said after signing a memorandum of understanding with the Pemberitaan Angkatan Bersenjata news agency.

A number of Indonesia's prime exports declined significantly last year. Textile and textile related products, which rank first among other products and contributes 15 percent to the country's total export earnings, declined to US$5 billion last year from $6.1 billion in 1993.

Export revenues from plywood fell by 8.4 percent during the January-October period of last year to US$3.49 billion. Exports of wood products, mostly plywood, account for almost 14 percent of Indonesia's total exports.

Minister of Trade Satrio B. Joedono commented, before attending a limited cabinet meeting on the economy last week, that the fall in exports of prime products resulted from, among others, the emergence of new competitor countries like Vietnam, China, India, Turkey and Pakistan.

The minister noted that the government is repositioning on a number of primary exports which recorded a significant decrease.

"We will position ourselves among our competitors and then figure out how to face the new and tough competition," Joedono said.

Lengkong suggested that the government change its export strategy because a number of competitors have been able to grab Indonesia's share of the market.

"If we don't change our export strategy, we will be left further behind," Lengkong stated.

He contended that Vietnam and China are a step ahead in providing export financing facilities, including long-term credits, special credits for export-oriented companies and export credits.

He also suggested that ministers conduct more trade missions overseas and that the government build more promotion centers abroad. Currently Indonesia has 13 overseas promotion centers, as compared to South Korea's 79 centers, Malaysia's 29 centers and Singapore's 20 centers. (rid)