Trading Tripatra wins $316 million contrak

JAKARTA (JP): A senior trade official advised state-owned trading companies yesterday to cooperate with international partners to help strengthen Indonesia's export marketing network.

"All the trading companies overseen by the Ministry of Industry and Trade lack an international marketing network because they are too dependent on the domestic market," the ministry's secretary general, Aidil Juzar, said after installing new directors at state-owned surveying firm PT Superintending Company of Indonesia (Sucofindo).

Aidil swore in Sutrisno as president of Sucofindo and Didie B. Tedjosumirat and Zafar Dinesh Idham as directors.

"Cooperation with experienced trading companies is important to help state firms penetrate international markets," Aidil said.

He said the government had protected its trading firms against imports so they had concentrated on the domestic market, particularly on the domestic distribution of imports.

Protectionism also caused an ignorance of the potential of imports, he said.

"Exports contribute about only 5 percent of their total revenue," he said.

Aidil said the state trading companies' capital structures were mostly weak because they had borrowed too much money.

"These high loans force the companies to pay large amounts to service debt," he said.

He said their inefficient operations had encouraged domestic industrial companies to export their own products, instead of using state trading firms.

This situation was contradictory to the situation in Japan where industrial firms preferred to use trading houses to sell their products, he said.

Aidil said his ministry had suggested to the Ministry of Finace that the government merge its trading companies to strengthen their financial structures and improve their efficiency.

He said several private investors had expressed interest in joining state-owned trading companies.

Aidil said increasing exports was important if Indonesia was to reduce its current account deficit.

Indonesia's current account deficit in forecast to rise to US$8.82 billion -- about 4 percent of gross domestic product in 1996/1997. It was $6.99 billion in 1995/1996. (10)