High added value key to competition<\/p>\n
JAKARTA (JP): Indonesia has to systematically improve its
\nindustrial technology to enable it to compete with its main
\nrivals, China and India, in the world markets, says an executive
\nof a noted multinational company.<\/p>\n
Kenneth Courtis, the vice president of the Tokyo-based
\nDeutsche Bank Capital Market (Asia) Ltd., said here yesterday
\nthat turning to high added value products is the key factor to
\nenable Indonesia to compete with those two countries.<\/p>\n
"Indonesia has to go that way otherwise it will lose its
\nexport markets," he told The Jakarta Post during a break of a
\none-day symposium on investment in the Asian region.<\/p>\n
Courtis was one of the speakers at the symposium held to
\ncommemorate the 25th anniversary of Deutsche Bank's Jakarta
\nbranch. The other speakers included Norbert Walter, the chief
\neconomist of the Deutsche Bank Group, Don Stammer, the chief
\neconomist of Bain and Company Limited, Hadi Soesastro, an
\nexecutive of the Center for Strategic and International Studies,
\nand Bacelius Ruru, the chairman of the Capital Market Supervisory
\nAgency (Bapepam).<\/p>\n
Courtis praised the Indonesian government's moves to further
\nopen up the country's economy, which he said would stimulate
\nproduction efficiency nationwide.<\/p>\n
He, however, considered that the opening-up of the economy is
\nnot enough without further deepening the scale of the country's
\nindustrial technology.<\/p>\n
Relying on labor intensive industries, he said, will put
\nIndonesia on the losing side as its main competitors such as
\nChina and India have stronger and cheaper labor forces.<\/p>\n
"At present, Indonesia's products might have the same
\ncompetitive edges with those of China or India but in the long
\nrun Indonesia could become a loser as its labor force would be
\nmore expensive," he said.<\/p>\n
Change<\/p>\n
The key factor to enable Indonesia to compete in the
\ninternational markets is to change the scale of the technology of
\nits export-oriented industries, he said.<\/p>\n
"Indonesia has to, therefore, gradually switch its industries
\nto those producing higher added value products," Courtis said.<\/p>\n
Soesastro acknowledged that in certain sectors, China has
\nstronger competitive edges.<\/p>\n
"But don't overestimate that country, which is now undergoing
\na major structural change both politically and economically," he
\nsaid, adding that the change could not only affect that country's
\nexport drive but also its overall economy.<\/p>\n
He said that a number of Indonesia's export products remain
\nmore competitive than those of China.<\/p>\n
Unlike Courtis, Soesastro sees the dismantling of the
\ngovernment's protection on agriculture-based products as the
\ncrucial factor in further expanding Indonesia's export markets.<\/p>\n
He said that Indonesian agricultural products would be more
\ncompetitive than those of any Asian countries if the government's
\nprotection is dismantled.<\/p>\n
"Our strong competitive edge actually lays in the agricultural
\nsector but as most important farm products are protected, we
\ncannot tap the market's potentials," he said.<\/p>\n
Indonesia's export earnings from agricultural products are
\nless than one-third of those of Thailand and less than one-fifth
\nof Singapore's, he said.<\/p>\n
"The low export figures of Indonesia's agricultural products
\nindicates there is something wrong in the management of this
\nsector," he said, adding that Indonesia, given its more abundant
\nnatural resources, should have taken the lead in the farm-based
\nindustries.(hen)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/high-added-value-key-to-competition-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}