Major companies start expansion projects: Luhut

JAKARTA (JP): Although foreign investors are still reluctant to enter the country, several major existing companies have started to expand their businesses, Minister of Industry and Trade Luhut B. Panjaitan said on Tuesday.

"At least three major companies will start expanding next year," he said during a hearing with the House of Representative's Commission V for industry and trade affairs.

Luhut said the companies were electronics' manufacturers PT Sony Electronics Indonesia and PT Matsushita Kotobuki Electronics Peripherals Indonesia (MKPI), and computer-printer manufacturer PT Indonesia Epson Industry.

Sony Electronics would increase its exports to $350 million next year, and Epson to $1 billion from $650 million, the minister said. Luhut did not disclose the export target of Matsushita but he said that the electronic giant's exports from Indonesia would rise to about 3 percent of Indonesia's gross domestic product (GDP) in 2003 from only 0.5 percent of GDP in 2000.

The minister stated that the three electronic giants' expansion commitments reflected the growing confidence of foreign investors in Indonesia.

He said that the economy had also shown signs of recovery as reflected by economic growth of 2.36 percent in the first three months of the year and 0.38 percent in the second quarter of 2000.

He added that he expects growth of between 4.5 percent and 5.5 percent in 2001, considering the emergence of a more stable economy, broader growth of exports and a better investment climate.

Exports between January and August totaled $40.25 billion, consisting of $8.98 billion from oil and gas and $31.26 billion from the non-oil and gas sector, representing an increase of 31.78 percent and 25.53 percent respectively over the same period last year.

Exports this year were targeted at $56.7 billion, with $12 billion coming from the oil and gas sector, and $44.7 billion from the non-oil and gas sector, Luhut said. This year's estimated total exports would far exceed last year's $48.6 billion.

"We are optimistic that exports will exceed the original estimate of $60.4 billion," he said. (tnt)