Japan intends to resume car talks

Japan intends to resume car talks

JAKARTA (JP): Japan's foreign minister, Yukihiko Ikeda, said
he intended to resume bilateral negotiations on Indonesia's
national car policy in a bid to maintain good relations with
Indonesia.

Ikeda said in Tokyo he had learned of Indonesia's and
President Soeharto's disappointment with Japan's decision to take
Indonesia's national car policy to a panel of independent judges
under the World Trade Organization (WTO) in Geneva on April 30.

"We intend to discuss the problem with Indonesia for the sake
of maintaining excellent bilateral relations," Ikeda was quoted
by Antara as saying after a cabinet meeting Tuesday afternoon.

Japan's minister of international trade and industry, Shinji
Sato, said he could understand President Soeharto's and
Indonesia's disappointment.

Soeharto expressed his disappointment Monday over Japan's
decision and ordered an end to bilateral negotiations on the
issue.

The President, after a special meeting with several economics
ministers and the central bank's governor, Monday, said the
government would push ahead with its national car program.

"The Japanese move has strengthened our resolve to reduce our
economic dependence on other countries," the minister/state
secretary, Moerdiono, quoted the President as saying Monday.

The minister of industry and trade, Tunky Ariwibowo, said in
Jakarta on Tuesday that he was optimistic Indonesia's national
car program would be completed by the time the WTO ruled on
Japan's complaint in 1999.

Tunky, who is in Japan on a trade mission, said in Kyoto
yesterday Indonesia would go all out to complete the national car
program.

"The government will assist the development of local component
manufacturing to support the national car program," Tunky said.

He said Japan's move would not, however, affect bilateral
relations between the two countries.

Indonesia's national car program, launched in February last
year, gives duty and tax breaks to PT Timor Putra Nasional to
make Timor sedans.

As the company has yet to build an assembly plant here, PT
Timor Putra was licensed to import up to 45,000 fully assembled
sedans from South Korea's Kia Motors Corp and sell them in
Indonesia as national cars bearing Timor brandname..

Indonesia's Ambassador to Japan, Wisber Loeis, met Japanese
ministry of international trade and industry officials Monday to
clarify Japan's decision.

"The officials told our ambassador that Japan decided to ask
for a WTO panel because the bilateral negotiations thus far had
made no progress at all," a spokesman for the Indonesian embassy
in Tokyo said.

In October 1996, Japan, the United States and the European
Union filed separate complaints to the WTO over Indonesia's
national car policy which they say is discriminatory and violates
WTO rules.

But while Japan has decided to ask for a WTO panel to settle
the dispute, the European Union and U.S. have continued bilateral
negotiations with Indonesia under WTO supervision. (06/vin)