Govt may cut sporting goods import duties

Govt may cut sporting goods import duties

JAKARTA (JP): Minister of Industry Tunky Ariwibowo said here
yesterday that the government is considering lowering some import
tariffs as far as zero percent on raw materials for sporting
goods in hopes of improving the competitiveness of local
products.

Acmaddani G-Martha of the Sporting Goods Industry Association,
who met Tunky yesterday, quoted the minister as saying that he
will discuss the possibility of lowering import tariffs on such
materials with other members of the tariff team.

After last month's reshuffle the tariff team is now comprised
of Tunky, Minister of Trade Satrio B. Joedono and Minister of
Agriculture Sjarifudin Baharsjah as members, Coordinating
Minister of Industry and Trade Hartarto as chairman and Minister
of Finance Mar'ie Muhammad as vice chairman.

Martha noted that reduced import tariffs will help sporting
goods producers keep the competitive edge following the
government's plan to raise local minimum wage levels between 11
percent and 35 percent as of April 1.

"Our factories are mostly labor intensive and thus we are very
sensitive to changes in labor wages," he said. "So, if the
government agrees to lower import tariffs like we have proposed,
it will offset the burden of our production costs stemming from
the rise in labor wages."

He noted that import tariffs on a number of raw materials for
sporting goods are still high, ranging from 30 percent to 40
percent.

According to the director of sporting and educational goods
industries, Sakri Widhianto, there are 68 companies nationwide
producing sporting goods such as balls, rackets, nets, golf
equipment, fishing and other water-sports equipment as well as
articles for gymnastics and athletics.

In 1993, Indonesia's exports of sporting goods, excluding
sporting shoes, reached US$31 million, 8.25 percent higher than
the previous year. During the January-June period of last year,
exports increased by 7.5 percent to $11 million from the same
period of 1993.

"Only 30 percent of the country's total sporting equipment is
exported, while the remainder is marketed locally," Sakri said.

Indonesia's imports of sporting goods, however, stood at only
$7.7 million in 1993, down 14 percent from the previous year of
$8.99 million.(rid)