Set lower paper prices for textbooks: Tunky

Set lower paper prices for textbooks: Tunky

JAKARTA (JP): Minister of Industry Tunky Ariwibowo called on
local pulp and paper producers Tuesday to set lower prices for
paper used for the production of textbooks.

"In a time like now, when international prices of pulp and
paper are very high, we ask them to share the windfall profits
with the people, especially students," Tunky said after reporting
to President Soeharto.

Tunky explained that international prices for pulp currently
reached highs of between US$800 and $900 per ton, sharply rising
from a range of between $260 and $300 per ton two years ago.

Domestic prices of newsprint surged from Rp 1,320 per kilogram
in the January-March period to Rp 1,600 last April and went up
again to Rp 1,700 a kilogram this month. The prices of HVS paper,
also rose to a range of between Rp 2,600 and Rp 2,800 a kilogram.

He said that domestic prices of newsprint and HVS paper are
still lower than international prices. The current price of
imported newsprint is US$880 per ton or Rp 1,960 per kilogram,
while the price of imported HVS paper is Rp 2,870 a kilogram.

A number of parties, especially educators and intellectuals,
have voiced their concern over the steep price increases of
newsprint and other types of papers, saying that this could
threaten the reading habits and ultimately the education of
Indonesian children.

Tunky said he has summoned the Association of Indonesian Pulp
and Paper to discuss the matter. "But we haven't yet reached an
agreement," he said.

He has also reported the problem to Soeharto and was advised
to do his best to help the students.

Tunky indicated, however, that he will not take drastic
measures to compel paper factories to bow to the government's
appeal, saying that this would be counterproductive in terms of
the country's investment policy image.

"Don't forget that we have to attract more private investment,
and that's why we have to keep our policy consistent," Tunky
contended.

Currently there are 62 pulp and paper producers operating in
Indonesia with a total installed capacity of 2.9 million tons for
pulp and 3.8 million tons for paper.

Tunky acknowledged that the production of pulp and paper is
still dominated by private-sector companies, mainly Sinar Mas
Group, Raja Garuda Mas and Aspex Paper.

"Currently we have only the state-owned PT Leces paper
company. But the government will strengthen control over the
paper industry through a regulation which will be introduced
soon. And, of course, the continuity of the industry in the long
run will be considered," Tunky said.

He projected that the country's total demand for paper of all
types will reach 2.26 million tons this year. Of the projected
demand, newsprint demand might reach only 150,000 tons, or seven
percent of the total demand.

Indonesia's newsprint is supplied by Aspex, which has a
monthly production capacity of 16,000 metric tons, and Leces with
a capacity of 3,000 tons. Aspex exports part of its products,
while Leces has recently reduced its newsprint capacity in favor
of higher quality paper. (rid)