New joint venture to produce color picture tubes
New joint venture to produce color picture tubes
JAKARTA (JP): PT Tabung Gambar Indonesia yesterday clinched a deal with Toshiba Corp, Sumitomo Corp, both of Japan, and Orion Electric Co. Ltd. of South Korea for setting up a new joint venture to produce color television picture tubes in Bekasi, West Java.
The new venture, named PT Tosummit Electronics Devices Indonesia, will be 35 percent owned by Tabung Gambar Indonesia, 28 percent by Toshiba, 22 percent by Sumitomo and 15 percent by Orion Electric.
"All parties have agreed to invest a total of US$140 million in the venture, of which some $40 million will be capitalized through the company's own equity," Hideharu Egawa, Toshiba's visiting executive vice president told reporters after the ceremony yesterday.
The remaining $100 million of the investment will be financed by loans from a foreign bank syndicate, he added.
Yesterday's ceremony was witnessed by Minister of Industry Tunky Ariwibowo, Minister of Investment/Chairman of Investment Coordinating Board Sanyoto Sastrowardoyo and executives of the Japanese and Korean corporations.
Located at a 11.3-hectare land in an industrial park in Bekasi, the new plant will be designed to have an output capacity of 2.3 million television tubes per year, of which around 30 percent will be shipped to Toshiba's television manufacturing operations in Singapore.
The plant is expected to be operational by the middle of next year.
"We plan to produce over five million tubes per annum after three years of operating in the country," PT Tosummit Electronics Devices commissioner Rachmat Gobel, who is also a commissioner of the major electronic company, Gobel Group, told reporters.
The company, which will manufacture multi-range tubes of 14- to 21-inch sizes, will export 65 percent of its products and supply the remaining 35 percent of the products to the local market, Rachmat said.
"We will tap the marketing network of Toshiba and Sumitomo for the distribution of our products," he added.
Local demand for television set is estimated by industry analysts here at around 2.5 million a year.
Base
With the establishment of the venture, which is Toshiba's third overseas production site for color picture tubes after Thailand and the United States, Toshiba is committed to making Indonesia an important industrial base for its TV tubes, Egawa said.
"For the purpose, we will bring our know-how here and transfer our advanced state-of-the-art technology to local partners," he said.
Tunky meanwhile said that the plant, the first of its kind in the country, will give mutual advantages to both parties, considering that Indonesia has a import duty exemption for picture tube spare parts.
Welcoming the establishment of the new electronic plant, Sanyoto said that: "I believe that electronic products will become one of Indonesia's major export commodities."
He noted that the Investment Coordinating Board has thus far approved a total of 268 electronic industries with a commitment of Rp 1.2 trillion under the domestic investment scheme and $2.5 billion under the foreign investment scheme.
He noted that electronic exports significantly increased from $1.1 billion in 1993 to some $1.8 billion in the first 11 months of last year. "Our potential export of this sector is around $5.3 billion per annum," he added.
Sanyoto is also optimistic about brisk new investment approvals this year.
"In the first two months alone, we have approved more than $10.3 billion of new foreign investments," he said.
Last year, he said, foreign investment commitments were around $23.7 billion, compared to some $8.9 billion in 1993. (fhp)