Minister threatens to boycott Sony

The Jakarta Post, Jakarta

Minister of Manpower Jacob Nuwa Wea said he would launch a boycott campaign against the products of Japanese tech giant Sony Corp. unless the company explained its decision to close its production plant in Indonesia, an official said on Tuesday. "(Jacob Nuwa Wea) said that if Sony goes ahead and stops production here without a clear explanation, then he will campaign for a boycott of Sony products," said ministry spokesman Dwi Anto, as quoted by AFP.

Nuwa Wea made the threat at a public event on Monday. The spokesman said he would lead a boycott campaign in his individual capacity as a concerned citizen.

Last week Sony announced it would relocate its audio plant from Indonesia to Malaysia, surprising officials here.

The plan, Sony has said, was part of its global restructuring strategy to reduce production bases from 70 to 54.

Sony is not the first company to pull out of Indonesia. But it had been a long-time investor in the country and the surprise decision has further tarnished Indonesia's reputation as an investment destination.

In the absence of further explanation from Sony, officials and experts were left with speculation as to the precise reasons.

Trade minister Rini Soewandi cited labor and tax problems, while industrial sources suggested smuggling of electronic goods had become intolerable.

Economists, however, said Indonesia's overall poor investment climate -- mired in a volatile regulatory environment, difficult tax regime and security problems -- was driving investors away.

Sony said it would maintain its audio distribution unit PT Sony Electronics. The plant closure would take effect in March 2003 and would cost about 1,000 Sony employees their jobs.

"Sony employs thousands of workers and the closure of its operations here will mean a lot more unemployed people," Anto said.