Jakarta – Some 70 percent of the 286 newspaper publishers in Indonesia are facing dissolution or cessation of publication, if the increase in price of paper continues. The prices set by the producers are out of reach, while revenue from advertising continues to decline, and subscription prices are difficult to raise.

"Based on business calculations, hundreds of newspaper publishers in Indonesia should already have stopped publishing. If at present they still appear, that is because of their commitment and fighting spirit, " said secretary general of the Newspaper Publishers Association Drs Leo Batubara to Kompas on Tuesday (13/1).

He explained that the numbers were based on the number of newspaper publications in Indonesia at present, where 30 percent are considered sound, and the remaining 70 percent still progressing to that stage. Meaning that around 30 percent are considered to be self-supporting and developing. The other 70 percent are still in the stage of putting their own house in order.

According to Batubara, ever since the producers increased paper prices in November 1997, and then this January 1998, a number of newspaper publications have been complaining. But whereas last year they could still get by, now the situation has already become extremely critical.

He said that to overcome the high price of paper, the publishers take recourse to a variety of ways. By increasing subscription prices, cutting down on the number of pages, cutting down circulation, spacing frequency of publication, and cutting down on news coverage. A leaner work force is also a choice.

All the steps have been tried out while hoping that the conversion rate of the rupiah would soon become stable, so paper prices would return to normal. But reality was not as expected.

Conversion rate

Batubara explained that the increase in paper prices was in step with that of the conversion rate in Indonesia. He said that in July-September 1997 the price was still around Rp 1390/kg or Rp 1530 including sales and income tax. In November 1997 it increased by 44 percent and in December 1997 upped 132 percent to become Rp 3200/kg including taxes.

In January the paper price became Rp 4855 including taxes or an increase of 217 percent compared to July 1997. This is based on the average rate last week of Rp 8740/dollar.

He said that calculating circulation times the paper requirement, and the price differential based on the conversion rate, namely 4855 less 1530 or Rp 3325, the publishers have to add considerable funds.

The association's secretary general estimates that with that increase, a newspaper with a circulation of 10,000 and 12 pages, needs 23,5 tons of paper. The business concerned must add some Rp 78 million/month.

A newspaper with a circulation of 100,000 and 12 pages needs 235 tons of paper, and must add Rp 780 million/month. The same circulation but at 24 pages, needing 470 tons, would have to add Rp 1.7 billion/month. A newspaper putting out 500,000 at 24 pages and needing 2350 tons, would have to add Rp 7.8 billion.

Cause for concern

A number of newspaper publishers, both those with national as well as regional coverage, have mostly stated to be almost unable to face the paper price increase. Some dailies are even now appearing irregularly.

No wonder that several publishers, such as five in Medan, have stated they are ready to close down. They have cut down on number of pages, some have come down to the format of tabloids as the paper stock has depleted.

Chief editor and manager of Suara Karya, Syamsul Basri, put forward he would try to continue his publication, but if circumstances force otherwise, then nothing could be done.

The general manager of Kedaulatan Rakyat Yogyakarta, Dr H Soemadi H Wonohito put forward that the condition of his newspaper was now in the grey zone. Number of pages had been cut down from 20 to 16, and not improbably could become 12 pages in a short while.

On the same note, executive editor of Suara Merdeka Semarang, Amir Machmud NS, said that currently his newspaper was appearing with 16 pages, and to fill requirements was buying paper from any source. He said they would try to hold on even if the price was high, as long as they could provide the public with information. Even with just four pages.

Chairman of the Newspaper Publishers Association (SPS), Tatang Roeswita, said that of the 20 newspapers in East Java, 60 percent with just 15 percent advertising, were in a condition on the verge of no longer publishing. Their paper stock is paper thin, and their choice is between curtailed circulation or coagulation.