Tunky praises PT Astra lobby effort

JAKARTA (JP): Minister of Industry and Trade Tunky Ariwibowo said yesterday PT Astra International's lobbying of its Japanese principal, Toyota Motors Corp. in Tokyo, would help end criticism of Indonesia's national car policy.

Tunky was commenting on high-level lobbying by Astra executives led by president commissioner Mohamad "Bob" Hasan.

According to media reports Bob urged Toyota at Thursday's meeting to increase the local content of its cars assembled in Indonesia.

Tunky said the lobbying would help end the dispute over the government's national car policy.

The government recently ended its consultations with the United States, Japan and the European Union, which have accused the policy of violating World Trade Organization (WTO) rules. The talks were conducted bilaterally.

According to the WTO's dispute settlement mechanism the issue must be resolved through a WTO panel.

But until last month none of the three claimants had filed the case with the WTO panel.

"It's better if the issue does not reach the panel level," Tunky was quoted by Antara as saying.

Bob left for Tokyo after he was appointed as Astra's new president commissioner Wednesday.

Bob reportedly asked Japan to lay down its charges against the national car policy because Indonesia had a potentially huge automotive market which had yet to be tapped.

The national car policy, issued last February, grants duty and tax breaks to locally owned firms which make cars bearing Indonesian names, have 20 percent local content by the end of their first year of commercial operation and 60 percent by the end of their third year.

The government has appointed PT Timor Putra Nasional, owned by President Soeharto's son Hutomo Mandala Putra, as the only beneficiary of the facilities during the next three years, to make national cars.

Timor Putra cooperates with South Korea's Kia Motors Corp to make 1500cc Timor sedans in South Korea until their West Java assembly plant is built.

Astra assembles cars bearing Toyota, Honda, BMW, Daihatsu, Peugeot and Isuzu brand names. (pwn)