GE Lighting chooses RI as regional production base

JAKARTA (JP): GE Lighting, a unit of widely diversified General Electric of the United States, has chosen Indonesia as its main production base to serve Southeast Asian countries, the company's top executive said yesterday.

Stuart Dean, the chief representative of GE's Indonesian operations, said GE Lighting, one of the world's major suppliers and producers of commercial, consumer and industrial lighting, has for several years marketed its lighting products to the growing Southeast Asian markets through PT GE Lighting Indonesia, its local subsidiary.

He said that the Indonesian lighting subsidiary began manufacturing lighting products through its own factory in Surabaya, East Java, in 1995 to support its marketing networks in Southeast Asia.

"GE Lighting has, in fact, run businesses in China and India but the two production bases are mainly used to serve the two respective countries," he said following the announcement of a merger deal between GE Lighting Indonesia and the country's second largest lighting manufacturer PT Sinar Baru Electric (SiBalec).

Dean said that GE Lighting has two production bases in Southeast Asia; one in the Philippines to serve the Philippine market and the other one in Indonesia to serve the rest of Southeast Asian countries such as Singapore, Thailand and Vietnam as well as Australia.

"The Indonesian production base is in principal directed to serve ASEAN (the Association of South East Asian Nations)," he said.

According to Dean, Indonesia was chosen as the regional headquarters for the company's operations in ASEAN, which groups Brunei, Indonesia, Malaysia, the Philippines, Thailand, Singapore and Vietnam, not only because of its vast population but also due to its impressive economic progress in the last decade.

"The growth of the Indonesian economy is really impressive, reaching 8 percent per annum," he said. "The growth of the middle-class population is much higher, reaching over 14 percent per annum to over 20 million people at present," he said about of the prospect of the Indonesian market.

Because business does not always progress as smoothly as possible in developing countries, he said that his company is basing its investment on long-term prospects. "The little bump in the road," he said, is not something to worry about.

Paul Morse, the president of GE Lighting Indonesia, said that the merger with SiBalec, which last year booked a sales turnover of around US$16 million, is an important breakthrough in strengthening its marketing networks both at home and in other Asian countries.

GE Lighting Indonesia is the surviving company in the merger deal but most of SiBalec's brand names such as Dops and SiBalec will be maintained, Morse said.

He said that GE Lighting, which has so far invested around $50 million in Indonesia, is the majority shareholder in the venture but he declined to elaborate.

General Electric, which last year booked sales turnover of over $70 billion, established a financial joint venture with PT Astra International in 1992. General Electric is also the main supplier of aircraft engines for Indonesian airline companies.

In 1995, the business giant won a contract to supply state- owned railway company Perumka with a 2,000 horse-power locomotive. (hen)