Japanese investment grows despite 'national car' dispute<\/p>\n
JAKARTA (JP): State Minister of Investment Sanyoto
\nSastrowardoyo said yesterday that Japanese investments in the
\ncountry continue to increase, despite Japan's objection to
\nIndonesia's \"national car\" policy.<\/p>\n
Sanyoto told reporters after meeting with President Soeharto
\nthat Japanese investments approved by the government during the
\nperiod between January and June 27 reached US$4.9 billion in
\nvalue, or nearly 40 percent above the total investment
\ncommitments of $3.5 billion made by the Japanese last year.<\/p>\n
He said Japan's high investment commitments in the first
\nsemester of this year indicated that Japanese investors remain
\nconfident in Indonesia's business climate.<\/p>\n
\"It clearly shows us that concerns about a possible decline in
\nthe Japanese investments were completely wrong,\" he said.<\/p>\n
Such concerns surfaced after the government granted a pioneer
\nstatus in February to Timor Putra, owned by Soeharto's youngest
\nson, Hutomo Mandala Putra, to produce a \"national car\" in
\ncooperation with Kia Motor of South Korea. The status would allow
\nTimor Putra to receive special tax facilities, including the
\nexemption of import duties and luxury taxes.<\/p>\n
The tax incentives, which will last for three years, will
\nenable the company to sell its 1,600cc car at half the price of
\nJapanese makes of the same class.<\/p>\n
Major automobile giants from Japan, the United States and
\nEurope demanded that the Indonesian government revise the
\n\"national car\" project, saying that the exclusive treatment given
\nto Timor Putra is against the free trade principles set by the
\nWorld Trade Organization.<\/p>\n
They said that the unfair car policy could also discourage
\nforeign investments, especially those from Japan.<\/p>\n
Sanyoto said yesterday that most of the Japanese investment
\ncommitments were made a few weeks after the government announced
\nthe new car policy.<\/p>\n
Japan is the largest investor in Indonesia, followed by
\nBritain, Hong Kong and the United States.<\/p>\n
\"If Japanese investors halt their investments in Indonesia,
\nthey will miss the chances,\" he said. \"If they did not come,
\nother foreign investors would come in and take their places.\"<\/p>\n
The total foreign investment approvals in the period between
\nJanuary and June 27 rose by 8 percent to US$20.9 billion from
\n$19.4 billion in the same period of 1995.<\/p>\n
Sanyoto said that foreign investment approvals, which rose by
\nnearly 40 percent in 1995 to $39.9 billion, were expected to book
\na flat growth this year.<\/p>\n
\"We hope this year's investment approvals would be the same as
\nlast year,\" he said.<\/p>\n
Unlike foreign investments, domestic investment approvals grew
\nmuch faster in the first semester, rising by 120 percent to Rp
\n64.2 trillion from Rp 28.8 trillion in the same period of 1995.<\/p>\n
\"The domestic investments approved in the January to June
\nperiod reached almost last year's level of Rp 69.9 trillion,\" he
\nsaid, adding that the majority of the new domestic investment
\napprovals are directed to plantations.<\/p>\n
Sanyoto said that the new domestic investment projects are
\nexpected to open job opportunities for around 1,290,000 workers,
\nfar more than the 342,000 jobs expected from the domestic
\ninvestment projects approved in the first semester of last year.<\/p>\n
Most of the new investment commitments are targeted for paper
\nmanufacturing, plantations, food processing, housing, industrial
\nestates, power generation and the hotel industry. (hen)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/japanese-investment-grows-despite-national-car-dispute-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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