Japanese technology company Sony Corporation will close its audio equipment manufacturing plant in Indonesia due to labour and tax problems.

Japan's industry and trade minister, Rini Suwandi, has been quoted as saying Sony had been facing labour problems since early this year.

She would not elaborate on the nature of the labour and taxation problems, but says the government must give the two issues priority to prevent other companies from leaving the country. Ms Suwandi says Indonesian labour laws have given workers too much freedom to protest or hold demonstrations.

Sony says it will stop making audio equipment at its Indonesian subsidiary, PT Sony Electronics Indonesia, by March 2003 as part of its "overall global restructuring effort".