MANUFACTURING STATE COMPANIES DIFFICULT TO MEET THEIR RKAP TARGET

Jakarta, Aug 24 (ANTARA) - State companies operating in the manufacturing sector may have difficulties in meeting their 2009 company budget work plan target (RKAP), not that the price of steel on the international market had dropped.

"The manufacturing sector had been hit because the price of steel remained low," Secretary of the State Enterprises Ministry Said Didu stated in Jakarta Sunday.

He added that the manufacturing industry highly depends on the business situation of PT Krakatau Steel, the biggest steel producer in the country.

"If the performance of Krakatau Steel declined, the other manufacturing industries will also be affected. Therefore, I think it would be rather difficult for the manufacturing sector to try to meet its projected RKAP," he said.

But he did not elaborate on the extent of decline of the manufacturing sector.

He merely explained that up to the first semester of 2009 the manufacturing sector also belonged to the state enterprises which failed to meet their projected RKAP.

The sectors whose net profits may have exceeded their target are the banking, plantations, fertilizer, transportation, and construction sectors.

According to the State Enterprises Ministry, the net profit target in 2009 in the steel and steel construction sector had reached Rp568.98 billion, while in 2008 the profit reached only Rp316 billion.

The profit of construction services reached Rp444.8 billion, while that of docks and shipping companies Rp16.46 billion.

According to Said, Krakatau Steel's business scale is very large and affects other manufacturing sectors, like construction services and shipbuilding companies like PT Pal, while other manufacturing enterprises like Dok Kodja Bahari and PT Industri Gelas (Iglas) are currently in a restructuring process.