Korean shoemaker commits $30m of investment, others to follow

Korean shoemaker commits $30m of investment, others to follow

The Jakarta Post, Jakarta

Korean footwear manufacturer Poong Won, which produces for German
sportswear brand Adidas, will invest US$30 million in Indonesia
later this year as part of its global strategy to relocate
production outside China, the Ministry of Trade says.

"The investment is part of Adidas plan to relocate 24 percent
of its production from China to Indonesia and Vietnam," the
ministry said in a statement received on Wednesday.

The commitment was announced after a delegation led by
Minister of Trade Mari E. Pangestu met with Korean footwear
industry players, including Poong Won, Dong Sung NSC, Sung Shin
and Baik San, during her visit to Korea earlier this week.

The investment would begin in October, when Poong Won is
scheduled to install seven production lines (WHERE?). The new
factories are expected to provide 7,000 jobs.

The ministry hopes Poong Won's commitment to Indonesia will
encourage supporting Korean industries to also relocate. These
would include mid-sole maker Sung Shin and glue producers Dong
Sung SNC and Baik San.

"They (the supporting industries) have presented their plans
for expansion and new investment in Indonesia to support the
operation of Poong Won and other footwear manufacturers in the
country," the ministry said.

During the meeting, Korean investors asked for regulatory
certainty in investment, customs, taxation, labor and immigration
in the country.

The minister was accompanied by a team of representatives from
the Investment Coordinating Board (BKPM), the Taxation office,
the Customs and Excise office and the Ministry of Manpower and
Transmigration.

The Indonesian Footwear Association (Aprisindo) expects this
year's exports to reach $1.6 billion from last year's $1.35
billion, and with the new investments, exports are projected to
exceed $2 billion next year and $4 billion in 2010.