Business

Businesses slam govt's
high export growth claim

Businesses strongly criticized the government's upbeat forecast of 8 percent growth in non oil and gas exports for 2009 as "unrealistic", arguing that exports of non oil and gas commodities will instead drop steeply.

The Indonesian Chambers of Commerce and Industry (Kadin), the Indonesian Employers Association (Apindo) and other business groupings slammed the government target as too optimistic and lacking in detailed explanations.

Apindo chairman Sofjan Wanandi said there is little chance the country would post a growth in exports this year because of continued weakening in global demand.

"Where did that (8 percent) growth number even come from? with the global economy, I expect that exports, particularly of manufactured goods, will instead decline by between 10 and 20 percent (from 2008)," he said.

He said exports were very unlikely to pick up anytime soon while demand continued to weaken. The declining prices of commodities such as coal and crude palm oil would make it even tougher to book any growth in exports.

Non-oil and gas exports contribute about 80 percent to the country's total exports.

Trade Minister Mari Elka Pangestu announced Tuesday non oil and gas exports would grow by between 4.3 percent and 8 percent this year, betting on new export markets to offset a decline in the country's main traditional export destinations such as the US and European nations.

Among new markets targeted, Mari said, were countries in the Middle East and certain African nations.

However, echoing Sofjan's pessimism, Kadin chairman M.S. Hidayat doubted industries would be able to swiftly diversify export destinations within this year.

"I think it will be difficult to find new export markets within this year," Hidayat said after attending a ceremony at the State Palace.

Also, according to Sofjan, the diversification program would not be so easily carried out as "we will have to compete in the new markets with other exporters from China, India, Vietnam and Thailand, and they are all ready to mark down prices".

Benny Soetrisno, head of the Indonesian Textile Association (API), further said that this year would mark a loss for the country's exports in the global (textile) trade.

"An estimated 8 percent growth (in non-oil and gas exports) is way too optimistic," said Benny, who is also newly installed vice chairman of the Indonesian Chamber of Commerce and Industry (Kadin) on trade, distribution and logistics.

"I believe that 2009 is a lost year for our (non-oil and gas) exports. Or (in the best circumstances), there will perhaps be zero growth."

Kadin also called on the government not to impose tight conditions on the implementation of the planned Rp 50 trillion stimulus package and asked for it to be focused on labor-intensive industries to anticipate layoffs.

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