Japan's Panasonic bails out of Batam

The Jakarta Post

Japanese foreign investment venture PT Panasonic Battery Batam has pulled out of the country's free trade zone, Batam, shutting down all operations as of January 9, an official said.

Batam Industrial Development Authority (BIDA) public relations head Dwi Djoko Wiwoho said the company's management reported the closure Tuesday.

"The company claimed it wasn't getting enough orders and suffering from a lack of a competitive edge in the international market. The closure was purely a matter of their internal concerns."

Djoko said the company had sorted out its obligation to the workers as demanded by the law prior to closing down its factory -- which is pictured above as seen through the window of a car.

"There was no problem on the labor issue." Dwi said the departure of the battery factory was regrettable, but in terms its production, the type of nickel battery that the company made was outdated, as the market was now dominated by lithium models.

"As the authority I think we have been doing a good job. As to why they do not invest in lithium battery production, we do not know," he said.

Continuing a long-established decline, two manufacturing operations have exited Batam already this year, with Singapore venture PT Polestar Plastic Batam saying goodbye earlier this month.

Observations made the same day indicated there were no activities at three of the remaining 85 factories within the special industrial district, aside from the function of security guards posted outside. -- Fadli