Timah suspends workers to avoid facing more serious cash flow problems

The ailing publicly listed tin mining company PT Timah Tbk has said it had suspended a quite big number of its workers to avoid it from experiencing more serious cash flow problems.

Timah president director Erryana Hardja Pamekas said on Wednesday the workers would stay out of work from early December to January 31. But he did not mention their exact number.

Erryana said his company had planned to lay off part of its 3,750 workers, and that the measure would require some Rp 338 billion. For this, Timah would sell some of its assets in Pangkalpinang and expected to get Rp 200 billion from that sale.

?If necessary, we will also sell out assets in Jakarta,? Erryana told reporters.

Erryana said the company also had halted the operation of 12 of its dredgers.

Timah operates tin mines on the island of Bangka off southern Sumatra. It was once one of Indonesia?s well-performed companies.

The company has been under severe difficulties over the past months months due to the sharp drop in tin prices on the international market.

Eryana said on Wednesday Timah could survive only if the price of tin reached US$3,200 per ton on the world market.

?But, with the current estimate of the firm?s financial condition for late 2001, and its cash deficit of about Rp 50 billion, in 2002 the firm?s capacity to survive would be for three months at the most,? Erryana said.

He said Timah would be merged with other state enterprises, and not with another mining company, PT Aneka Tambang. He did not mention the name of the firms. (leo)