Foxconn Indonesia Project to Start by Early 2013

By webadmin on 06:49 pm Jul 27, 2012
Category Archive

ID/Damiana Ningsih Simanjuntak

ID/Damiana Ningsih Simanjuntak

Taiwanese electronics manufacturing giant Foxconn will begin investing in a factory in Indonesia by early next year, Industry Minister M.S. Hidayat says.

Hidayat said that the electronic component and IT product manufacturer, whose formal name is Hon Hai Precision Industry X, will invest up to $10 billion, spread over five to 10 years.

“The land surface annexed is about 500 hectares, but they will start with 50 hectares this year,” Hidayat said. However, the minister declined to say where the factory, which he has said could create up to 1 million new jobs, will be located.

He said it would most likely be built on Java, since it was the best prepared in terms of communications and transportation infrastructure.

Hidayat earlier said that Foxconn had sought to build the factory in Central or East Java.

Sanny Iskandar, the chairman of the Indonesian Association of Industrial Zones, said the association was ready to help seek land for the new Foxconn plant. Sanny said potential sites included East Java’s Lamongan, Gresik and Mojokerto areas, and Boyolali and Kendal in Central Java.

Sanny also pointed to Karawang, West Java, where the government is planning to build a new container port.

“For electronic component industries, East Java is more suitable because it has harbor access, but the association is ready to help Foxconn meet with zone developers,” he said.

Hendra Lesmana, the honorary chairman of the same association, said that the government should also consider offering sites outside Java to Foxconn.

“If possible it should not only be in Java. Look at eastern Indonesia, in Sulawesi, for example. There should be no jealousy [between regions],” Hendra said.

Chatib Basri, the head of the Investment Coordinating Board (BKPM), said he believed more time was needed before Foxconn began investing in the country, adding that it was unlikely to take place this year.

“I think time is still needed and it will not be this year,” he said, adding that the government and Foxconn were currently meeting in Taiwan to develop the plan.

The products manufactured by the company here may increase Indonesia’s economic self-reliance, acting as a substitute for imported goods.

Foxconn reportedly produces electronics components for Apple, Acer, Cisco, Dell, Hewlett-Packard, Intel and Microsoft, among others. It has plants in the United States, Europe, Japan, China, India, Malaysia, Brazil and Mexico.

In China, its operations came under scrutiny after a series of worker suicides in 2010 and subsequent revelations of poor working conditions at the company’s manufacturing hub in Shenzhen.