Textile firms asked to seek Japanese funds

Textile firms asked to seek Japanese funds

JAKARTA (JP): A senior finance official suggested here
Saturday that textile companies, now facing difficulties to
generate credits with low interest rates from local banks, raise
loans from Japan.

The chief of the Ministry of Finance's Agency for Financial
and Monetary Analysis, Marzuki Usman, said here Saturday that
Japanese financial institutions, including pension funds, are
holding a large amount of disposable funds, which may reach 13
trillion yen (US$128 billion).

He told a panel discussion organized by the Jakarta branch of
the Indonesian Textile Association that Japanese loans are
attractive because they carry low interest rates.

Many Indonesian textile companies are currently facing
difficulties in getting loans from domestic banks because their
industrial activities are viewed as high-risk because of the
downward trend of the country's textile exports.

Some textile firms, particularly small ones, have had to close
down after the recent increase of raw material prices which could
not be passed on to consumers.

Indonesia's textile exports, according to the Central Bureau
of Statistics, decreased by 6.19 percent to $5.79 billion last
year from $6.18 billion in 1993.

Marzuki, who is also the chief commissioner of the Jakarta
Stock Exchange, said Indonesian textile companies could use
Japanese banks or capital markets to find funds.

But, he said, that securing loans from Japanese banks is
rather difficult at present because they are now facing various
problems, including an increase in bad loans.

"An alternative is to attract Japanese investors to portfolio
investments in shares, bonds and commercial papers," Marzuki
said.

He said the Indonesian textile industry could use the branches
of Japanese securities firms at the Jakarta Stock Exchange, like
Daiwa, Sanyo and Nomura securities companies, to attract Japanese
investors in the capital market.

He also suggested that textile companies make more road shows
in Japan to introduce their businesses.

Marzuki pointed out that there are still many potential
Japanese investors who have little knowledge of Indonesian
industries. (04)