KAZAKHSTAN: Multistrada faces bureaucratic hurdles in building tire plant

As part of Multistrada's expansion plan, the tire maker and a state-owned company in Kazakhstan, Samruk Kazyna, signed an agreement in April 2012 to build a USD 300 million tire-making facility in Kazakhstan. The plant was set to have production capacity of 3 million units of tire.

"They never even promised when [the agreement] will be realized. Probably it's because they're a state-owned company, so the bureaucracy is pretty complicated,” said Uthan Sadikin, a director at Multistrada.

Multistrada, which exports 75 % of its production, said that it also aims to penetrate the market in Russia through Kazakhstan.

This year, Multistrada has set aside up to USD 40 million in capital expenditure, to increase production capacity at its tire-making facilities in Indonesia, and that spending plan includes purchasing machineries.

Pieter Tanuri, president director at Multistrada, said that the company is targeting production capacity this year at 16 million units, including tires for cars and motorcycles. The company also aims its net sales to grow by 5 % to Rp 340 billion (USD 29 million) this year.

Source: Daily "The Jakarta Globe", Jakarta; 17 June 2014
(Syed Rashid Ali, Karachi, Pakistan)