Sat, 04 Jun 1994

Paper users ask the government to lift duties on paper imports

JAKARTA (JP): Paper users want the government to lift duties on paper imports to help them survive against the high prices set by domestic paper monopolies.

"The government should lift tariffs on paper imports to force domestic producers to lower prices to proper, more reasonable levels," the chairman of a forum for paper users, Yoza Suryawan, said in a hearing with Commission VI of the House of Representatives (DPR) here yesterday.

The forum, set up last year, includes, among others, the Association of Indonesian Publishers, the Association of Indonesian Newspaper Publishers and the Indonesian Printing Company Association (PPGI).

PPGI's chairman, H.M. Fauzi Lubis, said high paper prices on the domestic market has caused most paper-based companies to go bankrupt.

"Out of the country's 100 notebook manufacturers, only nine are still operating," he pointed out.

Paper imports are subject to duties of up to 30 percent of its price.

Aspertaskom Chairman Untung Sastrawijaya said the high tariffs have encouraged domestic paper producers to increase their sales prices to levels similar to the price of imports plus duties, even though their production costs are the lowest in the world.

Indonesia's paper production costs are estimated at US$285 per ton, far lower than $429 in Canada and $485 in Scandinavian countries, he said.

"Indonesia's paper producers, therefore, need no protection from the government," he stated.

Untung said the protection has only benefited paper producers, which are commonly big companies which feel little obligation to price their commodities realistically. (02)