Japanese investors<\/p>\n
The outright rebuttal by State Minister of Investment Sanyoto
\nSastrowardoyo of Japanese businessmen's complaints about red
\ntape, import tariffs, customs services and taxation in Indonesia
\nis understandable.<\/p>\n
After all, Sanyoto can support his statement with a very
\nimpressive record of foreign investment approvals over the last
\ntwo years. In the first semester alone, total investment
\napprovals already exceeded US$20 billion, or almost the amount
\nfor the whole of last year.<\/p>\n
The Japanese investors' complaints were cited by the Japan
\nExternal Trade Organization (Jetro) from a survey of 931 Japanese
\ninvestors already operating in Indonesia, Malaysia, Singapore,
\nthe Philippines and Thailand. The survey, conducted last November
\nand December, was designed to gather the views of Japanese
\nbusinessmen regarding the reasons for their operations in those
\nfour countries and any problems they encountered.<\/p>\n
Jetro, being responsible for promoting not only Japanese
\nexports but also investments overseas, has regularly conducted
\nsurveys to gather input on how to further help Japanese investors
\nand exporters. The November, 1994 survey, for example, was made
\nto update the data Jetro collected from its previous survey in
\n1992. Hence, the survey was well intentioned and was not in
\nanyway aimed at singling out Indonesia as the target for
\ncriticism.<\/p>\n
Set against this background, we think it is unwise to simply
\ndisregard the findings of the survey. We should take pride in the
\nsteady increase in licensed foreign investments. That obviously
\nreflects investor confidence in the prospects of Indonesia's
\neconomy.<\/p>\n
But we should also acknowledge that in so far as Indonesia is
\nconcerned, licensed investment is one thing and realized
\ninvestment is quite something else. Our balance of payments, for
\nexample, shows that actual direct foreign investments in 1994,
\nthough larger than those in 1993, totaled only $2 billion.<\/p>\n
Moreover, the Japanese businessmen's complaints about red
\ntape, import tariffs, customs services and taxation actually are
\nnot completely new. European and American businessmen in
\nIndonesia also have often raised similar complaints. In fact,
\nAmerican businessmen see the way tax officials assess corporate
\ntax obligations as one of the biggest problems they encounter in
\nthe country. Even Indonesian businessmen, supposed to be more
\ntolerant about such problems, also have often voiced such
\ncomplaints.<\/p>\n
True, the packages of reform measures launched since 1985 have
\nsignificantly improved the business climate in Indonesia. But
\nwhat government officials often do not realize is the fact that
\nother countries also have been taking such measures and they are
\noften much better than Indonesia in enforcing the reforms.<\/p>\n
We think that instead of rejecting the findings of the Jetro
\nsurvey outright, it is perhaps better for Sanyoto and his office
\n-- the Investment Coordinating Board (BKPM) -- to get a copy of
\nthe complete report on the survey's findings to be used as
\nvaluable input for introspection.<\/p>\n
There are several other findings of the survey which could
\ngreatly help the BKPM in further promoting foreign investments in
\nthe country. The survey, for example, reasserts the acute
\nshortage of middle level managers in Indonesia and discloses that
\nmany Japanese investors look at Indonesia not as an export base
\nbut rather due to the major potential of its domestic market. The
\nsurvey also reveals that quite a number of investors are
\ninterested in relocating their plants to Indonesia to take up the
\nopportunities created by the government ruling on local contents
\nfor various industrial products. These findings and others about
\nlabor wages, incentives, infrastructure and many other issues can
\nprovide valuable input for the BKPM.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/japanese-investors-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}