`Business prospects boom in Indonesia -- for now'<\/p>\n
By Jack Taylor<\/p>\n
SYDNEY (AFP): Australia should move quickly to capitalize on
\nIndonesia's burgeoning economy which is creating new
\nopportunities for foreign companies, according to a government
\nreport released here yesterday.<\/p>\n
But it said Australia, slow in the past to recognize
\nopportunities there, could not rest on a presumed advantage of
\nproximity and for both countries to maximize the potential for
\nmutual benefit, "strategic thinking and flexibility" were
\nnecessary.<\/p>\n
It also warned that while Indonesia had achieved an impressive
\nmeasure of political stability under President Soeharto, it was
\nuncertain how its people and institutions such as the military
\nwould adapt to his eventual retirement.<\/p>\n
And it said Indonesia faces external pressures, especially
\nfrom the United States, which was pressing for improved wages and
\nworkers' conditions, while East Timor had also attracted
\ninternational attention.<\/p>\n
The report, by the East Asia Analytical Unit of Canberra's
\nforeign affairs department, was released here to coincide with a
\nmajor Australian trade promotion now underway in Indonesia.<\/p>\n
Prime Minister Paul Keating, currently in Jakarta with a
\nnumber of his ministers for the promotion, held a talk with
\nSoeharto yesterday.<\/p>\n
The report said the way forward for both countries "clearly
\nlies in economic developments which transcend national boundaries
\nand expand horizons.<\/p>\n
"Integration into global transport, telecommunications and
\nelectronic data interchange networks will be of enormous benefit
\nto both economies in an increasingly globalized environment."<\/p>\n
The rapid takeoff in Indonesia's economy had taken Australia
\nby surprise, although Indonesia was now Australia's 11th largest
\ntrading partner and two-way trade had trebled in five years to
\nthree billion dollars (US$ 2.2 billion).<\/p>\n
"Few would imagine that by the year 2020 Indonesia could be
\nour fifth largest export destination," it added.<\/p>\n
Both countries were now enjoying the benefits of financial
\nderegulation in the 1980s and regional partnerships would provide
\ngains to both countries over a range of manufacturing, resource-
\nbased, agricultural and service industries.<\/p>\n
Australian partnership in major Indonesian projects had been
\nlimited in the past to a few ventures involving firms like food
\ngroup Goodman Fielder's and mining companies BHP Co. Ltd and CRA
\nLtd.<\/p>\n
Doing business in Indonesia was "notoriously difficult" with
\nlanguage and cultural barriers and a maze of bureaucratic
\nregulations.<\/p>\n
Growth in Indonesia's industrial base would drive demand for a
\nrange of goods and services that Australia could supply, such as
\nin infrastructure development where there was already a backlog
\nof demand in communications, power, steel production and
\nautomotive parts.<\/p>\n
Australia was also well placed to help develop Indonesia's
\nrich mineral resources.<\/p>\n
"Having established a capability to handle Indonesian
\nprojects, Australian companies should have excellent prospects of
\nbuilding on this success as Indonesia's mining industry moves to
\nthe next stage of development."<\/p>\n
With Indonesia's middle class "set to explode during coming
\ndecades", prospects for retailing were also "very bright" -- both
\nin supplying the products and building the modern shopping
\ncomplexes.<\/p>\n
"Notwithstanding the fact that most Indonesians are Moslems,
\nthe potential for beer sales in Indonesia may be enormous, given
\nthe size of the population and the growth of disposable income."<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/business-prospects-boom-in-indonesia-for-now-1447893297",
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"sponsor": "Okusi Associates",
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