Foreign engineering firms upbeat on RI's manufacturing sector<\/p>\n
Fitri Wulandari, The Jakarta Post, Jakarta<\/p>\n
There is great optimism among foreign engineering companies that
\nIndonesia's economy is moving toward recovery, which would bode
\nwell for their businesses here.<\/p>\n
This optimism was apparent during last week's four-day
\ninternational manufacturing machinery exhibition in Jakarta,
\nwhich featured companies from around the world, including from
\nthe U.S., the UK, Germany, the Czech Republic and Singapore. It
\nwas called the largest expo for industrial machinery in the
\ncountry.<\/p>\n
\"Participants come here because they know that the economy is
\nrecovering and there is growth,\" said Indra Putra, director of
\nexhibitions at Pamerindo Buana Abadi, the expo's organizer.<\/p>\n
The participants seemed unperturbed by recent news that a
\ngrowing number of the country's manufacturers are facing
\nbankruptcy because of the poor economic climate, security
\nproblems, lingering labor disputes and rampant smuggling.<\/p>\n
\"There is a degree of political stability in the market and
\neconomic growth of three to four percent in Indonesia. It
\nprovides optimism for the future,\" Dai Harries, representative of
\nthe British Engineering Industries Association (EIA), told The
\nJakarta Post.<\/p>\n
EIA, the largest trade association for industry in the UK, led
\n14 British companies at the exhibition looking for distributors
\nand customers in the local market.<\/p>\n
Of similar opinions were the director of the German
\nEngineering Federation (VDMA), Hubert Laier, and the head of the
\nCommercial Section at the Czech Embassy in Jakarta, Martin Basta.<\/p>\n
\"This is a period when Indonesia's economy is shifting from
\nstabilization to growth. We come at the right time to promote
\nforeign trade with Indonesia,\" Basta told the Post.<\/p>\n
\"The three to four percent economic growth encourages us to
\ncome to Indonesia, and we hope to enlarge our market,\" Laier
\nsaid.<\/p>\n
Eighteen Czech companies took part in the exhibition offering
\nvarious manufacturing machinery, from woodworking to food
\nprocessing equipment.<\/p>\n
Meanwhile, Germany was represented by 25 exhibitors, led by
\nVDMA. Laier said the number of German exhibitors increased from
\n14 last year.<\/p>\n
This optimism flies in the face of the negative news coming
\nout about the country's economy and manufacturing sector.<\/p>\n
Foreign direct investment and domestic investment approvals
\nhave declined for a number of reasons, including labor conflicts,
\npoor labor policies, a poor implementation of the autonomy law
\nand global economic uncertainty.<\/p>\n
And many manufacturing companies in the country are going out
\nof business. The Association of Footwear Manufacturers
\n(Aprisindo) reported that some 100 local footwear manufacturers
\nhad closed down their factories over the last three years.<\/p>\n
The toy industry is facing a similar situation, with some 60
\nlocal companies going bankrupt and 40 others struggling to
\nsurvive.<\/p>\n
However, for many expo participants Indonesia remains a market
\nfull of potential.<\/p>\n
\"Indonesia's consumption power is so big, we hope to build up
\ncloser trade relations with Indonesia,\" Eugene Lim, the manager
\nof the Singapore Precision and Tooling Association (SPETA), said.<\/p>\n
SPETA led some 15 Singaporean manufacturing companies to the
\nevent. Lim said that next year more Singaporean engineering
\ncompanies were expected to take part in the exhibition.<\/p>\n
Despite the optimism, expo participants continued to harbor
\nsome worries. Most participants said the government's inability
\nto provide legal certainty would dampen optimism.<\/p>\n
\"I would say the labor law will be one aspect that could
\ndepress the economic recovery,\" Dai Harries said.<\/p>\n
The exhibition itself was a success, seemingly justifying the
\nparticipants' optimism.<\/p>\n
\"This was the biggest exhibition since 1997. We never expected
\nthat it would be this successful given last year's exhibition,\"
\nIndra Putra said.<\/p>\n
The number of visitors jumped from 27,000 people in 2001 to
\n53,400 this year.<\/p>\n
And the number of participants also increased significantly,
\nfrom 1,100 in 2001 to 1,500 this year.<\/p>",
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