Selling local products

Selling local products

One of the many problems in a developing country is
difficulties with marketing a local product. Constraints include
less proficiency in management, a shortage of funds and a general
lack of national pride.

The latest case is the refusal of PT Merpati Nusantara to
lease the CN 235-200 aircraft, because high operating costs
prevent it from being commercially profitable. From the point of
view of Merpati, perhaps it's the right decision. But it would be
better to consider the case in a national context.

CN 235 is a good aircraft produced by Indonesian engineers
using high technology. It is let down only by the cost of buying
and maintaining it. From the economic angle, it appears this
aircraft is not viable. However, they had difficulty marketing
the product because there is such a high interest rate penalty
for leasing the aircraft. And if we buy aircraft from foreign
countries we can expect to receive a loan from the sellers, known
as an export credit.

So CN 235 should do the same. The institution that provides
money for IPTN (the aircraft's producer) should not take high
interest. Instead, it should make a profit from the sale of the
aircraft.

SIHONO

Bandung, West Java