Japan to help Indonesia's small and medium companies

JAKARTA (JP): The Japan External Trade Organization (JETRO) pledged on Monday to help develop Indonesian small and medium enterprises which could support the relocation plans of Japanese factories to Indonesia.

JETRO president for Indonesia, Ikuta Shoichi, said many Japanese companies wanted to relocate their production plants to Indonesia because of the low labor costs and the abundance of natural resources.

"Therefore, it's very important for Indonesia to have a strong cottage industry," Shoichi said during a media conference at JETRO's office at the Summitmas I building, Central Jakarta.

Japanese companies are interested in seeing a stronger support industry, particularly for the electronic and automotive sectors, that would help cut their production costs if they were to relocate their plants to Indonesia, he said.

"JETRO intends to help prepare the local support industry for such investments," Shoichi said.

JETRO will assist the Indonesian government in designing policy on procedures for investment and exports to benefit small and medium enterprises.

The program will start next year, he said.

He did not elaborate on the program, which was discussed by a visiting Japanese economics team in Jakarta last week. The delegation's visit followed a meeting between Japanese Prime Minister Keizo Obuchi and President Abdurrahman Wahid in Jakarta last month.

JETRO in the past has brought in Japanese experts from various fields to promote Indonesia's industrial development.

Shoichi said that among the experts JETRO would provide were those from the technical, managerial and governmental fields.

JETRO has also collaborated with business associations, such as the Association of Electronic and Electrical Home Appliances Industries of Indonesia (GABEL), and the Association of Indonesian Automotive Industries (Gaikindo).

Besides bringing in Japanese experts, JETRO also holds seminars and international exhibitions with the industries it promotes.

JETRO has also actively promoted other sectors in Indonesia such as the handicraft and textile sectors, Shoichi said. (03)