indonesia - Asia Today International

THE REGIONtoll roads, ports and power stations.As well as attracting foreign investment,Bakrie says: "Definitely, we also want to growour indigenous business, which, too, has fallenaway.” But he is hopeful of an upward trend."With a stable political situation, people arenow more confident of Indonesia," he says,adding that Indonesia underwent a sevenmonth-longPresidential election last year withoutspilling blood in the streets. “It was verypeaceful election that came as a surprise toelection observers,” he says."Our President has vowed to fight corruptionand is committed to having a clean, transparentand professional Government. When he attendedthe APEC (Asia Pacific Economic Co-operation)Leaders' Summit last year, he was embarrassedthat Indonesia ranked as one of the mostcorrupt countries in the world." Bakrie says thePresident is determined that when he attendsthis year's APEC Leaders Summit, Indonesia'sposition will have improved. "He is putting a lotof effort into reducing corruption."While others may not agree with him,Minister Bakrie declares that corruption is not"on-the-table corruption" but admits thatmaybe there are still under-the-table deals. "Wewant a clean Indonesia in order to compete. Weare promoting Indonesia and we need to winthe trust of investors."Winning that trust is key to the revival of❝ Jakarta is putting the finishingtouches to a new industrialstrategy which will focus onnatural resources, agri-basedbusiness, chemicals and thepetrochemical sector.❞Indonesia, which was one of the most populardestinations for foreign investors in the early tomid-1990s.Bakrie says there have been a lot of complaintsabout the justice and legal systems.InMarch, there was a bankruptcy applicationinvolving payment of US$8 million, and thecourt turned down the application. "I don'twant to see a repeat of Manulife," he says.(Manulife was a protracted high-profile saga ofcorruption involving the Canadian life company,its co-investor, the International FinanceCorporation, and their Indonesian partner.)The Government is working closely withKADIN, the Indonesian Chamber of Commerceand Industry and Indonesia’s peak businessorganisation, on a range of issues of most concernto business these include taxation, investmentand labour law. Business leaders told ATIthat, for the first time in 50 years, business hashad an input into Government policies.It is early days yet, but Bakrie is heartened bythe fact that, in the last three months, the economygrew at 6.6 per cent and in 2004 finishedwith 5.13 per cent growth — ahead of the originalforecast of five per cent. "That growth is notin consumption, as in the past seven years, butis driven by exports (which rose by 18 per cent)and investment (up 13 per cent)," he says.Under the Government's Five-Year Plan, Bakrieaims to lift growth to 7.6 per cent in 2009,averaging 6.6 per cent over five years.INDONESIA PLANS AHEADFor SBY and business,the honeymoon continuesTHE HONEYMOON betweenPresident Susilo Bambang Yudhoyono and theIndonesian business community continues —six months after SBY’s election."This is the first time the private sector hasworked in close co-operation with theGovernment," says Mohamad Hidayat,President of KADIN (the Indonesian Chamber ofCommerce and Industry).Hidayat and a group of KADIN executivesand business leaders accompanied threeIndonesian Ministers, led by Aburizal Bakrie,the Co-ordinating Minister for EconomicAffairs, to Australia in March for a series ofinvestment seminars.SBY has told other foreign business groups towork together with KADIN to present theGovernment with a co-ordinated view of whatbusiness wants it to do."When we first had a chance to see thePresident-elect, one of the things we discussedwas why investors are not flocking to Indonesia.Instead, they go to China, Vietnam andThailand, John Prasetio, KADIN Vice Presidenttold ATI. "We told him the reason is badGovernment policy. Indonesia must reform itspolicies. We are encouraged by the pro-businessstance of this Government."Mohamad Hidayat: Close co-operation.KADIN co-ordinated the views of businessand drew up an economic developmentroadmap (see ATI December 2004) whichbroadly became the basis of the currentGovernment's agenda to reform its taxation,Untapped potential marketsin Asia? 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