Indonesian Political, Business & Finance News

State shipyard sees exports on the horizon

| Source: JP

State shipyard sees exports on the horizon

JAKARTA (JP): The state-run shipbuilding company PT PAL will
export four bulk carriers and one reefer vessel at a total value
of US$100 million to Britain and the Netherlands.

"We will soon sign the deals with the two countries,"
Suleman Wiriadidjaja, senior executive vice president of the
Surabaya-based firm told journalists yesterday.

Suleman said Britain will procure four 18,000-dead-weight-
ton (DWT) bulk carriers at $20 million each, while the
Netherlands will purchase one reefer vessel of 18,000 DWT at $20
million.

"This is our first export experience and it indicates that
our products have got international recognition," said Suleman.

His company has won ISO-9001 quality-assurance
certification from Germanischer Lloyd of Germany for its
management, designing, engineering and manufacturing.

He said his company has also won an international tender
from state oil company Pertamina for providing three oil tankers
of 17,500 DWT at a price of $23.1 million each.

PAL, which is overseen by the Supervisory Board for
Strategic Industries (BPIS) chaired by State Minister for
Research and Technology B.J. Habibie, produces a wide range of
vessels, from fishing to military ships.

The company can make two 450-DWT warships and four of the
60-DWT type annually.

Production

It has produced eight 450-DWT fast patrol ships, all
procured by the Indonesian Navy, and 17 60-DWT fast patrol boats,
of which 12 were bought by the Directorate General of Customs and
Excise. The five others were procured by the Police Force.

"The quality of our military ships is just the same as those
produced by German dockyards," Suleman said.

He noted that the company can produce at least three units
of 45,000 DWT commercial vessels yearly. Since early this year
the company has focused on producing large vessels of over 10,000
DWT.

Construction of smaller vessels, such as Caraka Jaya ships,
has been taken over by smaller shipyards.

Suleman explained that the marketing of PAL's commercial
ships has gone smoothly. It sells all products to state-owned PT
PANN Multi Finance, which then resells or leases the ships to
shipping companies.

"PAL has sold 32 commercial ships to PT PANN, and I heard
all of them are sold out. State-run shipping operator PT PELNI
even paid cash for some of them," Suleman said, adding that PAL's
commercial ships are among the most modern ones in their classes.

He said that investment in shipping is slow yielding and
that most banks are reluctant to finance the procurement of
ships, especially fishing vessels.

"However, PAL has signed a contract with a Spanish company
for making fishing vessels worth $32 million," Suleman said.

PAL has signed contracts with a number of international
shipbuilding firms, such as Mitsui of Japan and Luerssen Werft of
Germany, for transfer of technology. (rid)

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