PLN starts decentralization in project bid

JAKARTA (JP): The State Electricity Company (PLN) will offer 80 percent of its tenders for the procurement of electricity cables to manufacturing companies through its provincial offices, a company executive says.

"The decentralization of our policies on tenders will begin in the provinces in Java," PLN's head of operation and logistic division, Sudarso, said after attending a ceremony for the operation of PT Voksel Electric's new cable plant in Cileungsi, near Bogor in West Java over the weekend.

He said the policy is part of the company's efforts to meet the government's call for decentralization aimed at boosting provincial economies.

He added that only 20 percent of PLN's tenders will be offered through its headquarters in Jakarta.

He declined to elaborate on the schedules for the bidding.

In response to PLN's new tender scheme, the chairman of the Indonesian Association of Cable Producers (Apkabel), Kusudiarso Hadinoto, hailed PLN's decentralization scheme but he expressed his pessimism over the competitiveness of domestic cable producers because most of them have not implemented international standardization schemes on their products.

"Out of Apkabel's 25 members, only five have cooperated with foreign companies which can help improve the quality of products through a transfer of technology," he said.

Kusudiarso, therefore, urged the association's members to invite foreign investors to help improve the quality of their products.

He cautioned that the state-owned domestic telecommunications monopoly, PT Telekomunikasi Indonesia (Telkom), also plans to require the use of the internationally recognized ISO 9002 quality standard in the production of cables to be supplied for its transmission and distribution networks next year.

"It seems that investors from Australia, the United States and Europe are still reluctant to run cable businesses in Indonesia. I hope PLN's decentralization scheme will attract foreign investment," Kusudiarso said. (fhp)