TEMPO Interactive, Jakarta: George Soros, Director of Soros Fund Management and the Open Society Institute, has said that reason few foreign investors are coming to Indonesia is because of the unstable economy, high corruption rate and lack of transparency.
“Economic and political crises are tightly related,” said Soros during a public discussion “Indonesian Economic and Political Perspective 2007” held by Tempo yesterday (12/13) in Jakarta.
According to Soros, basically the Indonesian economy is already back on track but it is still moving too slow.
As a result, no-one obtains any significant improvements from the slow growth and indirectly this will endanger the stability of the state’s politics.
Long-term political stability is extremely crucial in order to create a sense of security: not only for local people, but also foreign investors.
“This is one of the important factors that will attract investors.”
When asked why foreign investors prefer Singapore to Indonesia, Soros answered that this was because Singapore offers stability, legal certainty as well as transparency.
He views Indonesia as still lacking these three issues with the results that many investors are yet to come.
Transparency, for instance, will show how the government carries out its duties.
Therefore, according to Soros, the government has an important role of issuing transparent regulations so that members of the general public are able to see them.
Regulations that enable the central government to control regional governments must also be revised.
“Several regulations have to be more transparent and be applied to all people so that they can also be involving in the monitoring,” he said.
This is one of the ways to move towards democratization.
In a response to Soros' statement, Finance Minister Sri Mulyani Indrawati said that Indonesia has made improvement as regards democracy, law and transparency.
The currently achieved economic growth, according to her, is also progressive.
“We already have transparent policies that are improving in quality. During the last two years, many policies have been formulated, although not all of them yet,” said Sri Mulyani on the same occasion.