Lubricant producers against import freedom

Lubricant producers against import freedom

JAKARTA (JP): The Association of Indonesian Lubricant
Producers (Aspelindo) has expressed concern over the government's
plan to ease restrictions on lubricant imports.

The association said the import liberalization would not only
hurt local producers but also consumers.

"Aspelindo supports a free market idea for lubricant trading
provided that it is carried out in the spirit of protecting the
national interest. But we are opposed to the idea of applying
liberal scheme in the trading," association chairman A.P.
Batubara told reporters on Friday.

The association was not afraid of competition with foreign
companies, he said, but it feared that free importation of lube
oils, as demanded by the Association of Indonesian Lubricant
Importers and Distributors (Perdipi), would lead to an
uncontrolled flood of poor-quality lubricants.

Inferior lubricants, Batubara said, would disrupt prices of
lubricants on the local market at the expense of local producers
and could damage automotives and other motorized vehicles.

He said there were hundreds of lubricant brands on the
international market and the public, which is mostly ignorant of
the quality of each brand, could be easily duped into buying
inferior lubricants.

"We are mostly concerned with the interest of consumers. Free
import of lubricants is not suitable at present when the law on
the protection of consumer rights is still nonexistent in the
country," Batubara said.

Perdipi earlier called on the government to revoke the 1988
presidential decree No. 18 which grants exclusive rights to state
oil and gas company Pertamina and several other local companies
on the production, distribution and importation of lubricants.

They said the monopoly was no longer suitable in the era of
reform.

Minister of Mines and Energy Kuntoro Mangkusubroto earlier
voiced support of Perdipi's concern, saying he looked forward to
the issuance of a new presidential decree which would scrap the
monopoly in the near future.

According to Batubara, aside from Pertamina, the government
has given licenses for the production of lubricants to several
private companies, including PT Wiraswasta Gemilang Indonesia,
PT Dirga Buana Sarana, PT Agip Lubrindo Pratama, PT Cemerlang
Pelumas Prima and PT Panutan Selaras.

However, Perdipi accused the companies of obtaining the
licenses during former president Soeharto's era based on their
links to Soeharto's children and cronies.

Batubara said Pertamina and the private lubricant producers
had production capacity of 500 kiloliters per year, higher than
the domestic demand of 400 kiloliters per year.

"We don't see any need to import lubricants at present due to
the oversupply in the country. But if there is a lack of supply
in the future, we don't disapprove of lubricant imports,"
Batubara said.

"But, we want the importers to cooperate with Aspelindo in
checking the quality of the imported lubricants at our
laboratories before selling them to the public," Batubara said,
promising that the check would be free of charge. (jsk)