Toray vows to maintain Indonesian operation

Toray vows to maintain Indonesian operation

TOKYO (Reuters): Toray Industries Inc pledged yesterday that the company would not withdraw from Indonesia or move its production bases to other countries despite the economic crisis in the country.

Toray, which has 10 Indonesian affiliates with a total of 4,600 workers, wants to expand in the country, although no specific plan has been set, the company's president Katsuhiko Hirai said.

"It will take about two to three years to see an economic recovery in Indonesia, but I believe the country will be back on a growth path towards the next century. We are set to expand our business in Indonesia, Malaysia and Thailand as needed in the future," the president said.

Toray has not received a request from any of its joint venture partners in Indonesia to provide fresh financial support or to buy their partners' stakes, he said.

The leading manufacturer of textile and synthetic fibres currently faces tough global competition arising from increased exports from Indonesia, Korea and also from Japan, which also pushed down global market prices, Hirai said.

Despite the tough business environment, Toray is aiming for a fourth straight year of growth in both sales and profits in the business year which started in April, he said.

Hirai said the company will be able to recover foreign exchange losses from the Asian crisis within two years by boosting exports from its Asia units.

He said the company's Asian units suffered currency losses of 11 billion yen in the last business year that ended March.

"I think we can recover the losses in one to two years by boosting exports," Hirai said.