Shipbuilders likely to move from industrialized countries
Shipbuilders likely to move from industrialized countries
JAKARTA (JP): Shipbuilding companies in industrialized
countries are likely to relocate their plants to developing
countries for lower production costs, an official said.
Director General of Metal, Machinery and Electronic Industries
Effendi Sudarsono said yesterday that the competitiveness of the
shipbuilding industry in industrialized countries tends to
decline due to the higher cost of production.
"Shipbuilding is a labor intensive industry and uses medium as
well as high technology ... This industry will shift gradually to
developing countries, including Indonesia," Effendi said at a
Danish marine technology and equipment symposium.
Effendi said that because Indonesia has decided to build all
new ships at local shipyards, it is inviting the cooperation of
foreign partners as suppliers.
Indonesia, Effendi said, also opens its door widely for
foreign investment in the shipbuilding industry as Government
Regulation No. 20/1994 allows foreign investors to own full
equity in a shipbuilding business.
"As we have comparative advantages available in our country,
the industry is being developed in order to support our national
economic growth and to impel exports forward," Effendi said.
Chresten S. Jorgensen of the Danish Export Group Association,
who came here with executives of 17 marine companies, said that
the Danish marine industry has long cooperated with Indonesian
shipyards.
Indonesia currently has some 220 shipyards. However, most of
them have the capability to only build ships of less than 1,000
dead weight tons (DWT), Effendi said.
He noted that a number of shipyards, which currently can make
ships of up to 30,000 DWT, will improve their capability to build
ships of 100,000 DWT within the next five years.
"Although our capacity is relatively small, this industry has
been internationally competitive to a degree that we have been
able to export ships to several countries," Effendi told the
symposium without detailing the exports.
He noted that Indonesia used to export shipbuilding equipment
worth US$10 million annually, while its annual imports of similar
equipment stood at US$100 million. Last year's imports reached a
record high of around $400 million. (rid)