JAKARTA (JP): Minister of Industry Tunky Ariwibowo yesterday

JAKARTA (JP): Minister of Industry Tunky Ariwibowo yesterday
opened PT Gajah Tunggal National Electronics (GTNE), an export-
oriented telephone manufacturer.

The company's President Commissioner Sjamsul Nursalim, said GTNE --
located on 4.2 hectares of land within the grounds of the Gajah
Tunggal Industrial Estate in Tangerang, West Java -- was built in
April, 1991 as a joint venture between Indonesia's Gajah Tunggal Group
and Hong Kong's National Electronic Consolidated.

The company's manufacturing facilities, built with a total
investment of Rp 15 billion (US$7 million), was designed with a
capacity of three million telephone sets per year or 10,000 per
day, he said.

The company also announced the production of its one millionth
telephone that was exported yesterday.

GTNE's exports initially went to the U.S. Northwestern Bell company
after its first year of production and but have now expanded to
other countries, including those in Canada, the Middle East and
South East Asia.

"Our target for this year will be 80 percent for exports, and 20
percent for the domestic market," he said.

Meanwhile, Tunky said Indonesia's export of electronic
products could still be increased because it only reached $1.21
billion last year, or 0.15 percent of the world's market of
electronic goods which reached $800 billion.

"Indonesia has fallen behind many countries in the export of
electronic products. Even Malaysia's exports are ten times more than
ours," Tunky said.

Obstacles

He admitted, however, that there were other obstacles to
Indonesia's exports, including worldwide recession, tough
competition from foreign manufacturers and import restrictions in
many countries.

"We have carried out consultations with producers'
associations and received complaints from foreign entrepreneurs
concerning the difficulties in investing here," he said.

He added that prospective investors mostly complained about
the high costs and ineffective implementation of the October 1993
deregulation package.

Tunky explained the government was currently preparing another
deregulation package which would not only boost the relocation of
foreign assembling factories in the country but also of
component-producing plants.

"If we continue to let in assembling companies, our exports
will always increase along with imports. If we remove a tree, we
should also remove its roots and not just its trunk," he said.

Indonesia's industrial exports last year reached $23.3
billion. This was up 16.5-percent from 1992. Industrial exports
last year made up 63.2 percent of the country's total exports and
85.8 percent of the total non-oil exports which reached $27.15
billion.

Electronic imports in 1993 reached $2.37 billion, which was a
38.3 percent increase from 1992.

Together with the metal and machine category, electronics is
expected to contribute as much as 10 percent to the total
industrial exports, which are targeted to reach $55 billion by
the end of the Sixth Five Year Development Plan (Pelita VI) in
the year 2000.

Most of Indonesia's electronic exports go to the U.S. (34.9
percent), Singapore (21.2 percent), countries in the European Union
(26.6 percent), Japan (4.5 percent), Canada (2.3 percent) and several
other countries.(10)