Business giants raise concerns over rupiah<\/p>\n
Rendi A. Witular, The Jakarta Post\/Jakarta<\/p>\n
The volatile rupiah exchange rate against the greenback remains a
\ngreat concern for foreign investors operating in Indonesia, as
\nany uncertainty in the economy could cause unnecessary downturns
\nin their businesses.<\/p>\n
In a rare closed-door meeting with President Susilo Bambang
\nYudhoyono on Friday, 22 top executives of major foreign companies
\nor their local arms expressed their concern over the issue and
\nwere seeking direct input on the economic condition from the
\npresident.<\/p>\n
The Indonesian Chamber of Commerce and Industry (Kadin) vice
\nchairman for international economic cooperation, John A.
\nPrasetio, the moderator in the meeting, told The Jakarta Post of
\nthe deep concerns of businesspeople and the need to create a
\npolicy that ensured the stability of the rupiah against the U.S.
\ndollar.<\/p>\n
"The businessmen have expressed their optimism over investment
\nopportunities in Indonesia. However, they are still concerned
\nover uncertainty in the rupiah exchange, which they say was
\n'chronically weak'," he said.<\/p>\n
"They fear that unless there are immediate and substantial
\nchanges in policy, a sharp depreciation in the rupiah will happen
\nagain in the future, thus, creating uncertainty in the operation
\nof their businesses here," he added.<\/p>\n
The rupiah started to nosedive in August when it slumped to a
\nfour-year low to around Rp 11,000 against the dollar, despite
\noptimism from the Cabinet's economic team at that time that the
\nrupiah was going to stay at around Rp 9,500.<\/p>\n
The slump was triggered by the soaring global oil prices --
\nwhich passed the US$70 per barrel mark on Aug. 30 -- that
\neventually dragged down the stability of the fiscal and monetary
\nsector.<\/p>\n
The rupiah has been picking up again this week, following
\nSusilo's announcement on his new economic line-up -- particularly
\nthe comeback of former finance minister Boediono as chief
\neconomic minister -- thus boosting market confidence.<\/p>\n
In the meeting, the businesspeople also highlighted problems
\nsuch as strange regulations, lack of contract sanctity involving
\nthe government, state enterprises and the private sector, as well
\nas unfavorable tax and labor laws.<\/p>\n
The need to improve governance within the bureaucracy was also
\nemphasized in the meeting, with the executives suggesting the
\npresident immediately replace "unproductive" bureaucrats who
\noften disrupted the operation of private sector companies.<\/p>\n
"There is also a concern from the businesspeople over the slow
\nprocess in replacing troublesome bureaucrats in several key
\ninstitutions, which have caused ineffective governance and
\ndiscouraged investment," said John.<\/p>\n
Boediono pledged that he would take concrete and immediate
\nactions to follow-up on the suggestions and complaints from the
\nbusinesses so the government would not appear to be a "no-action-
\ntalk-only" entity.<\/p>\n
"Should there be no real action to address the
\nbusinesspeople's complaints in the foreseeable future, the public
\nis entitled to be cynical," he said in a post-meeting press
\nconference.<\/p>\n
To cater to investors' needs, both local and foreign, they
\nwill have a regular meeting with Susilo every four months at
\nseparate events starting in January.<\/p>\n
I-box
\nForeign company executives attending the meeting:
\nName Company Position
\nPeter Coleman ExxonMobil Indonesia President Director
\nFrancisco Noriega Cemex Indonesia Chief
\nrepresentative
\nGiuseppe Nicolosi Ernst & Young CEO<\/p>\n
Indonesia
\nHans-Josef Schill Bayer Indonesia CEO
\nLeonard Van Hien Jardine Matheson Country chairman<\/p>\n
Group Indonesia
\nSachio Yamazaki Toyota Motor President Director<\/p>\n
Manufacturing Indonesia
\nMichihiko Kanegae Sumitomo Indonesia President Director
\nJ. Francois Fichaux BNP Paribas Indonesia Country director
\nChristopher K. Cornille Cabot Indonesia President Director
\nJohn Harrison Asuransi Jiwa President Director<\/p>\n
Manulife Indonesia
\nLow Sin Leng Sembcorp Industry Senior executive<\/p>\n
director
\nLuigi Carlo Gastel Pirelli-Telecom President Director<\/p>\n
Italia Group
\nMartin King HM Sampoerna President Director
\nRichard Baker Ford Motor Indonesia President Director
\nSimon Wilson Macquarie Bank Vice President
\nStuart Dean GE International President Director<\/p>\n
Operation
\nYasuo Ichimura Itochu Indonesia President Director
\nTim Leissner Goldman Sachs Senior managing<\/p>\n
director
\nJoe C. Bartlet American Chamber of President<\/p>\n
Commerce and Industry
\nKoki Hirota JBIC Chief
\nrepresentative
\nKosuke Imashimizu Jetro Jakarta President
\nPeter Fanning International Business President<\/p>\n
Chamber<\/p>\n
Source: State Secretariat<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/business-giants-raise-concerns-over-rupiah-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }