Jittery tugboat owners refusing to carry granite

The Straits Times, April 7, 2007
By Devi Asmarani, INDONESIA CORRESPONDENT


KARIMUN (RIAU ISLANDS) - TUGBOAT owners fearful of having their vessels seized by the Indonesian Navy are having a knock-on impact on the granite industry here.

Although there is no official ban on granite exports, the boat owners are refusing to make deliveries following the Navy's seizure in late February of several tugboats ferrying the building material to Singapore.

The Navy says the boats were detained either on suspicion of hiding contraband sand beneath their granite cargo or for breaching shipping regulations.

It has yet to release the vessels.

With jittery boat owners refusing to undertake further shipments, granite companies here and on nearby Tanjung Pinang Island have been forced to slash production, with obvious implications for profits and employees' jobs, industry players said.

'The problem is not entirely ours, it is that owners of tugboats are still reluctant to carry granite for fear of being detained by the Navy again,' Mr Kartabuana Syam, head of the Karimun chapter of the Association of Granite Producers in Riau, told The Straits Times.

The halt in shipments has forced some of these companies to cut production by as much as half, Mr. Kartabuana said.

For the time being, none of the 1,500 people employed by the granite industry on Karimun has been retrenched, but with the companies feeling the pinch, there are definite fears of job losses.

At PT Karimun Granite, South-east Asia's largest hard rock quarry operation with 450 employers, general manager Arif Rahman told The Straits Times: 'If we don't start exporting now, we will have cash-flow problems.'

And in a plea for the government to end the uncertainty over the export situation, Mr Kartabuana said: 'We have about 6,000 people, including the families of our workers, relying on this industry on this island alone.

'I think it is fair to ask the government to keep our operations alive.'