Consolidation and co-operation

Indonesian shipbuilding is mainly concentrated on the island of Java and has always played a vitally important part in the local economy where sea communications are essential to local trade. Although a small player in world terms, the local shipbuilding industry is capable of providing a full range of facilities for Indonesian shipping companies in terms of ship repairs and newbuildings and has strengthened its competitive position through consolidation by mergers and co-operation with foreign yards. One of the leading players is PT. Dok & Perkapalan Kodja Bahari Persero, more commonly known as Dok Kodja Bahari or DKB. This Jakarta-based shipbuilder is a new company born as a result of merger of four shipyards namely, PT Dok & Perkapalan Tanjung Priok (Persero), PT Kodja (Persero), PT Pelita Bahari (Persero) and PT Dok & Galangan Kapal. Back in 1999, PT Kodja Bahari, now part of DBK and the largest state-owned shipbuilder of Indonesia, entered into a co-operative venture with Daewoo Corporation and Daesun Shipbuilding & Engineering from South Korea to build a 5,500kW towing vessel for the Indonesian Navy. The Korean companies undertook to supply materials and key assembly technologies to the Indonesian shipbuilder while at the same time providing technical support. The yard will complete construction of the vessel this year. Also based in Java is the government-owned company of PT Dok Dan Perkapalan Surabaya which is capable of building ships up to 8,000 dwt. It can also carry out repairs and conversions on ships up to 10,000 dwt and it has also diversified into offshore construction. Another key player is PAL Indonesia, an engineering conglomerate, which in 1999 achieved sales turnover of just under Rp 700 billion ($83 m), of which Rp 96 billion was generated from newbuildings. Ship repair and maintenance amounted to Rp 118 billion. Although the bulk of the newbuildings that year were warships, i.e. 14 units, the company also built two commercial vessels at its main facility in Surabaya in an interesting co-operative venture with the German shipbuilder Meyer Werft. The co-operation between Meyer Werft and the island republic of Indonesia is one of the most successful development projects undertaken by Germany. Since 1995, PAL Indonesia has succeeded in entering the international market by building 18,500 dwt dry cargo vessels and 42,500 dwt open-hatch bulk carriers for European owners. The company also carries out design activities on tankers, bulk carriers and container ships up to 50,000 dwt and warships such as aluminium fast patrol vessels and low-cost corvettes of 1,200t displacement. Further evidence of foreign co-operation is the Singapore owned Labroy Shipbuilding and Engineering company which together with its wholly owned subsidiary PT Nanindah Mutiara Shipyard, operates a large shipyard on the island of Batam. The fully equipped shipyard has two floating docks and three newbuilding berths. n