Investment in bonded zones more than doubles

Investment in bonded zones more than doubles

JAKARTA (JP): Foreign and domestic investment in the bonded
zones managed by state-owned PT Kawasan Berikat Nusantara (KBN)
increased by 153.4 percent to US$560 million last December from
$221.03 million at the end of 1994.

KBN said in a statement here last week that the number of
companies making investments in the bonded or export-processing
zones rose by 28 percent to 169 from 132.

The statement quoted KBN's public relation manager, Deddy S.
Wiraatmadja, as saying that the investors included 70 companies
from Taiwan, South Korea, Hong Kong, Singapore, France and Italy,
while the rest were domestic firms.

Besides managing its own three bonded zones in Jakarta -- at
Tanjung Priok, Cakung and Marunda -- KBN also manages eight
other bonded zones owned by private companies in Semarang
(Central Java), in Surabaya and Mojokerto (both in East Java), in
Medan (North Sumatra), in Bekasi and Cibitung (both in West
Java).

Deddy said that the Marunda bonded zone is being expanded and
is slated to be marketed later this year.

He also said that KBN will open a new branch office in a newly
opened export-processing zone on Bintan Island in Riau.

At the bonded zones, KBN provides factories and warehousing
facilities as well as forwarding services. All imports of capital
goods, raw materials and components for manufacturing activities
in these zones are exempted from import duty and value added tax.

Deddy said that to attract more investment, KBN has offered
the incentive of eliminating management fees at its bonded zones.

He added that the company has also improved its service
regarding providing letters of origins for goods produced at
bonded zone. The service currently takes less than 24 hours and
KBN can now provide 250 such letters per day.

Deddy said that total exports by companies operating in bonded
zones increased by 50.8 percent to $1.1 billion in 1995 from
$729.37 million in 1994.

"Exports from bonded zones in the January-September period of
1995 reached $797.24 million or 11.83 percent of the country's
total exports worth $6.73 billion," he said.

For comparison, exports from bonded zones in the January-
September period of 1994 were recorded at $523.53 million or 8.53
percent of the country's total exports of $6.14 billion, he said.

Deddy said that the use of local materials and components by
companies operating in bonded zones increased to Rp 210.5 billion
($91.3 million) in value in 1995 from Rp 186.4 billion in 1994.

Despite the increase in the use of local products, the imports
of material rose by 50.5 percent to $579.6 million in 1995 from
$385.16 million in the previous year. (kod)