(MENAFNEditorial)
JAKARTA February 10 2015 – The government plans to restrict new investment opportunities in cement industry to secure business climate for the existing companies.
Directorate General of Manufacturing Industry Base for the Ministry of Industry HArjanto said the existing cement production capacity was more than enough to fulfill domestic demands.
He said if the investment opportunities are wide open the industry might be oversupplied. Such condition might cause an unhealthy market condition as the existing cement companies would also expand their business.
The Ministry of Industry also concerned that the incoming investment might come from low technology companies. More advanced technology is expected to reduce the effect to the environment.
"I'm afraid with China's economic slowdown the country’s cement producers may move to Indonesia. I'm afraid those who enter are low technology companies so that the energy consumption is high as well" said Harjanto in Jakarta last weekend.
National cement production capacity is approximately 77 million tons per year with utilization in the range of 70% - 80%. This percentage is equivalent to the production volume of about 59 million tons per year. The realization of the national cement consumption in the past year reached 60 million tons.
Harjanto said the investment relocation of Chinese cement producers has been suspected to enter into the country. Investors are mostly interested in East Java. Meanwile the Industry concerned if the cement factories use secondhand machinery. Read more…
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