Protection for new ventures defended

Protection for new ventures defended

JAKARTA (JP): The government yesterday defended its decision
to offer selective protection against imports to new industrial
ventures.

"The basic protection policy stresses the importance of
protecting the new industrial ventures," Coordinating Minister
for Economy and Finance Saleh Afiff said here yesterday.

Saleh said this to clarify the tariff protection promised on
Thursday by State Minister of Investment/Chairman of the
Investment Planning Board (BKPM) Sanyoto Sastrowardoyo for the
olefins to be produced by PT Chandra Asri in Serang, West Java.

Sanyoto's promise comes in the wake of the government's June
27 deregulation package, which ruled out any protection for new
industrial projects. New projects, according to the measures,
should comply with the going rates as stipulated in the
Indonesian Import Tariff Book.

Sanyoto said during his visit to Chandra Asri's project on
Thursday that the government is committed to protecting its
products against imports on the grounds that the project has
absorbed large amounts of investment, in addition to its
strategic role as a foreign exchange generator.

He estimated that the project, when operational next April,
will be able to save some US$1.6 billion per annum in foreign
exchange.

"When Chandra Asri is able to compete against imports, the
government will terminate the protection facility," he said.

The project, billed as the biggest olefin center in Southeast
Asia, is being set up by timber baron Prajogo Pangestu in close
cooperation with Bambang Trihatmodjo, one of President Soeharto's
sons, Henry Pribadi and Peter Gontha. (fhp)