Producers moan about high tariffs on plastic materials

JAKARTA (JP): Plastics producers yesterday spoke out against high tariff protection for materials which has led to substantial increases in production costs.

"The main problem is that import duties and surcharges are also imposed on several derivatives of polyethylene and polypropylene that have not been produced domestically," Chairman of the Indonesian Plastics Manufacturer Association (Apindo) A. Sarbini said yesterday.

He said imports of plastic materials are generally subject to a duty of 20 percent and a surcharge of another 20 percent.

Sarbini told The Jakarta Post during a break in a seminar on the plastic industry that the government apparently does not realize that the high tariffs also affect materials which have not been produced locally.

The seminar, organized by Apindo in cooperation with the Japan External Trade Organization (Jetro), featured several Japanese experts discussing plastic industry management and technology improvement.

Sarbini said executives of his association have asked the government to lower import tariffs on plastic materials to improve efficiency of the domestic industry, so that the country's products can compete on the world market.

Y. Santo, secretary general of the Indonesian Plastic Industry Federation, said that the government should also lower import duties on petrochemicals used to complement materials in plastic manufacturing.

The government should also lift import duties on machinery used to manufacture plastic products that have not been made domestically, he added.

Indonesia exports several plastic products, including household plastic goods, PVC pipes, plastic packaging and plastic bags.

The country's exports of plastics reached US$144.79 million last fiscal year to March.

The country currently has 398 plastic manufacturers with a total capacity of 763,375 tons per year, employing more than 83,000 people. (05)