Government to check dumping charges

Government to check dumping charges

JAKARTA (JP): The Ministry of Industry and Trade said on
Friday that it would investigate allegations of dumping practices
against foreign hypermarket operators here.

Director General of Domestic Trade Teddy Setiadi said his
office would follow up claims by the Association of Indonesian
Retailers (Aprindo), which accused French chain stores Continent
and Carrefour of intentionally selling goods at a loss in order
to eliminate competing local supermarket chains.

"If Aprindo has evidences of the dumping practices conducted
by those hypermarkets, they should give it to us so we can check
it directly in the field," he said.

Teddy said that as far as he knew, the foreign-owned
hypermarkets were able to sell their goods at cheaper prices
because they set a smaller profit margin.

With lower profit margins, the stores would be able to achieve
high sales volumes, he said.

"It is not dumping. Those foreign hypermarkets, such as
Carrefour and Continent, are not only backed with huge capital
but also work more efficiently," he said.

Aprindo's executive director, Kustarjono Prodjolalito, said
last week that Continent and Carrefour were conducting dumping
practices here in an attempt to drive local supermarket chains
out of business.

He said the operators were selling their products below cost
prices to undercut local retailers and ultimately send them into
bankruptcy.

He said that Aprindo had evidences that foreign hypermarkets
were not merely offering discounts to attract buyers, but selling
their products at a loss in order to kill local retail chains.

Teddy said that Aprindo should meet executives of Continent
and Carrefour to discuss ways to reach a mutually beneficial
solution.

"The government is trying not to interfere too far in private
sector matters. So we will only help if they cannot reach a
satisfactory solution," he said.

Carrefour and Continent entered Jakarta last year offering a
wide variety of products, ranging from groceries to clothes and
household appliances.

Their arrival followed the signing of the letter of intent
between the government and the International Monetary Fund in
March last year, which required the country to lift its
restrictions on foreign investment in the retail and wholesale
markets.(gis)