ID :
29345
Mon, 11/10/2008 - 01:11
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http://m.oananews.org//node/29345
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INDUSTRY MINISTRY PROPOSES FOUR STEPS TO PROTECT DOMESTIC STEEL INDUSTRY
Bandung, Nov 9 (ANTARA) - The Industry Ministry has proposed four steps to protect the national industry from the impact of the current global financial crisis.
"There are four instruments we will propose to help the domestic industry cope with the impact of the global financial crisis," director general of metal, machinery, textile and multifarious industries Anshari Bukhari said here on Sunday.
The first is import control, under which import licenses are granted only to importer-exporters and producer-importers, and only based on contracts with small poducers in need of raw materials.
"So, a limited importer can import only in the absence of a contract with local producers," Bukhari said.
The second is an anti-dumping policy on Hot Rolled Coils (HRC) cut into Hot Rolled Plates (HRP).
The third is a safeguard for domestic trade in imported steel nails.
"At this moment, there are ten national nail manufacturers shut down because of increasing steel nail imports. In the meeting last Wednesday, we have urged the introduction of the safeguard mechanism," said Bukhari.
The forth is the 25 percent increase in the price of upstream steel, mid-steel by 30 percent and downstream steel up to 35 percent.
However, the price increase policy can become inactive because most of the imported steel came from China, Japan, South Korea and ASEAN member countries which have free trade bilateral or regional agreements with Indonesia, Bukhari said.
"So, no matter how high the price hike, it would not significantly help the domestic steel industry. Most effective would be control of imports," he said.
The Industry Ministry will switch the suggestion with the harmonization of steel product price policy.
The income tax on nail and wire, for instance, will be increased to 12.5 from 7.5 percent.
We hope the proposal on import control can be implemented soon, by the Trade Ministry to protect the domestic industry, Bukhari said.
"However, I'm still worried that the surplus Chinese steel production now reaching 50 million tons per year will enter Indonesia with decreasing demands for steel because of the current financial crisis," said Bukhari.
"There are four instruments we will propose to help the domestic industry cope with the impact of the global financial crisis," director general of metal, machinery, textile and multifarious industries Anshari Bukhari said here on Sunday.
The first is import control, under which import licenses are granted only to importer-exporters and producer-importers, and only based on contracts with small poducers in need of raw materials.
"So, a limited importer can import only in the absence of a contract with local producers," Bukhari said.
The second is an anti-dumping policy on Hot Rolled Coils (HRC) cut into Hot Rolled Plates (HRP).
The third is a safeguard for domestic trade in imported steel nails.
"At this moment, there are ten national nail manufacturers shut down because of increasing steel nail imports. In the meeting last Wednesday, we have urged the introduction of the safeguard mechanism," said Bukhari.
The forth is the 25 percent increase in the price of upstream steel, mid-steel by 30 percent and downstream steel up to 35 percent.
However, the price increase policy can become inactive because most of the imported steel came from China, Japan, South Korea and ASEAN member countries which have free trade bilateral or regional agreements with Indonesia, Bukhari said.
"So, no matter how high the price hike, it would not significantly help the domestic steel industry. Most effective would be control of imports," he said.
The Industry Ministry will switch the suggestion with the harmonization of steel product price policy.
The income tax on nail and wire, for instance, will be increased to 12.5 from 7.5 percent.
We hope the proposal on import control can be implemented soon, by the Trade Ministry to protect the domestic industry, Bukhari said.
"However, I'm still worried that the surplus Chinese steel production now reaching 50 million tons per year will enter Indonesia with decreasing demands for steel because of the current financial crisis," said Bukhari.
