Seatrade Maritime is part of the Informa Markets Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Tsuneishi earmarks $40m to set up ship repair facility in Indonesia

Tsuneishi earmarks $40m to set up ship repair facility in Indonesia
Japan’s Tsuneishi Holdings Corporation has announced a plan to spend $40m to set up a ship repair facility in Indonesia, while a second phase investment could see the establishment of a shipbuilding business.

The Japanese shipbuilding and maritime transport firm had revealed earlier that it is looking to set up a new shipyard in Southeast Asia, and Indonesia is now chosen after having explored Cambodia, Vietnam and Myanmar.

“We see a big potential to develop Indonesia’s shipping industry. We’ve estimated that around 3,293 ships will require repair services each year,” Yasuharu Fushimi, chairman and president of Tsuneishi Holdings, said in a statement.

The proposed ship repair facility would eventually be expanded into the shipbuilding business, according to Fushimi, but there is no timeframe for such a move yet.

Franky Sibarani, chief of Indonesia’s Investment Coordinating Board (BKPM), has recommended at least five locations for the investment, namely Lampung, Lamongan, Surabaya, Makassar and Manado.

Fushimi said that the Indonesian government is planning to enhance sea connectivity, which is one of the main reasons for his firm to choose the archipelago nation.

Tsuneishi Holdings’ investment into Indonesia will contribute to employment, absorbing approximately 1,000 workers, the group’s statement said.

Tsuneishi Holdings has established a presence in China, the Philippines and Paraguay in four business sectors – environment, energy, shipping and shipbuilding.

Meanwhile, Indonesia’s shipbuilding industry would need investments to the tune of IDR20-30trn ($1.5-2.3bn), but the pace has been slow due to the sluggish economic growth. Moreover, Indonesia’s notorious red-tape is also having a negative impact for its shipbuilding sector, where costs are high and vessel prices are uncompetitive.

Eddy Kurniawan Logam, president director pf PT Logindo Samudramakmur Tbk, told Seatrade Maritime earlier that the hefty 10% VAT and 5-12% of import duties on shipbuilding components need to be removed before Indonesian shipyards can compete globally.