President wants firms to cut prices of goods and services

Tuesday, 13 January 2009

The Jakarta Post

President Susilo Bambang Yudhoyono has demanded firms reduce the price of goods and services following the government's decision to reduce fuel prices.

"Business players must adjust their prices. Production costs have gone down, don't pretend it didn't happen and maintain the same prices," Yudhoyono said at the state palace on Tuesday.

Yudhoyono said that the cost of transportation services provided by state firms had come down, but not those of privately owned and managed companies.

"It doesn't make sense. We cut fuel prices by 25 percent and 18.2 percent respectively, but there has been no price adjustment in transportation tariffs," he said.

Following the decline in global commodity prices, the government reduced the retail price of Premium gasoline by 25 percent to Rp 5,000 (0.45 US cents) a liter and the price of diesel gasoline by 18.2 percent to Rp 4,500 on Dec. 1.

The government plans to make further fuel price reductions. The price of Premium will be cut by 10 percent to Rp 4,500 per liter and the price of diesel will be cut by 6.25 percent to 4,500 per liter.