Japanese investors need clear message<\/p>\n
Indonesia is seeking to reschedule some US$5.5 billion of its
\nsovereign debt maturing this year and in 2003, from the Paris
\nClub of creditor nations. Japan, the biggest country lender to
\nIndonesia has indicated its readiness to discuss the issue with
\nPresident Megawati Soekarnoputri's government, if Indonesia is
\nable to meet all the required conditions.<\/p>\n
In an interview with The Jakarta Post's Kornelius Purba, Nobuo
\nHazeyama, the chief representative of the Japan Bank for
\nInternational Cooperation's (JBIC) Jakarta office, shared his
\nview about Indonesia and the result of the bank's recent survey
\non investment in a number of countries including Indonesia. His
\noffice is in charge of overseeing the disbursement of all his
\ncountry's official loans to Indonesia.<\/p>\n
Question: Finance Minister Boediono has disclosed the
\ngovernment's intention to reschedule some $5.5 billion of its
\nloans with the Paris Club this year. What will be Japan's
\npossible response?<\/p>\n
Answer: First, this is a problem between the government of
\nIndonesia and Japan. However Japan fully understands your
\ngovernment's situation and is very willing to extend its help. So
\nI am not pessimistic, although I cannot say I'm optimistic, that
\nyour government will get what it wants. Indonesia is too
\nimportant to be ignored. But I think your government must be able
\nto fulfill tough conditions to get the new concession.<\/p>\n
Q: Indonesia and Japan have agreed to revive the four stalled
\nmegaprojects, including Chandra Asri and the Paiton power plant.
\nYour bank is also involved in financing some of them. What is the
\nsignificance of the projects resuming?<\/p>\n
A: I do hope this will be a good sign that those projects will
\nbenefit the economy of this country. And still, this is more than
\nI expect. But only solving old problems would not be convincing
\nenough for Japanese companies to make new or expanded
\ninvestments. That is very sad, and this again indicates the
\nproblem of images and weakening of the economy. To solve the old
\nproblems and think of starting to work ahead are quite important
\nelements ... Your government can have more self confidence if
\nthey can carry out these projects.<\/p>\n
Q: Can these projects be resumed this year?<\/p>\n
A: I hope so. Basically they have reached agreements, and this is
\nthe year of implementation.<\/p>\n
Q: From your bank's survey we understand there are many
\ncomplaints about the lack of transparency, corruption and poor
\nlaw enforcements in Indonesia. Can you specify more?<\/p>\n
A: It is unfortunate to say that because the current confusion
\nis accompanied with this transition period some people say that
\ncorruption is worsening compared with before. This is a unique
\nsituation. Of course I don't believe there is no corruption in
\nother countries, but it is still quite clear that such corruption
\ncases are decreasing in other countries ... Some people say
\ncorruption is increasing here because there are so many
\nstakeholders at this moment. Previously there was just one
\n(ruler), so when someone said yes then it was OK.<\/p>\n
But now you have to go to the central government, and then
\nregional governments. I don't say that this situation adds
\ncorruption -- but you are always asked for some contribution.
\nWhether it is corruption I do not know, but still it is
\nadditional cost for companies. That is the image.<\/p>\n
Q: But how about possible corruption practices in the
\ndisbursement of Japanese official loans to Indonesia?<\/p>\n
A: We do not have any problem with corruption, because our
\nfinancing system is project by project. When some contractors
\nmake progress, then the consultant will check the quality of the
\nwork and Indonesian government will check it and then talk about
\nit. So things are exactly according to the contract. Indonesian
\ngovernment gets quality work, so I don't believe there is the
\npossibility of corruption with this process.<\/p>\n
Q: Corruption has became an old issue in Indonesia, and Japanese
\ncompanies have long experiences with this practices. So what is
\nthe confusion?<\/p>\n
A: There were clearer rules in the previous governments. We do
\nnot know what the new rules, new regulations are. What is the
\nrelation between the central and regional governments, no one
\nknows. Worse, your government says something, but some days later
\nthey change it. That happens.<\/p>\n
(Indonesia's) transition is very big, even bigger than the
\nMeiji restoration. So some confusion is quite unavoidable. But it
\nis really difficult for profit making companies to wait for 10
\nyears to 20 years.<\/p>\n
It is important that there will be a clearer message. There
\nare so many bills which have been presented to your legislature
\nwaiting for decision making. But still the bills are still in
\nthere and we not know when they are to be decided, including the
\nnew investment bill.<\/p>\n
(Ours) was a survey study, it is very subjective and not based
\non concrete facts or information, and this is more difficult
\nbecause the survey is on images. To change an image is very
\ndifficult. If you believe something, how can I change that?
\nPeople are looking for a better place for business.<\/p>\n
In this transition period there is no clear regulation or
\nrules matching the new decentralization system. So we are facing
\nproblems. That kind of situation happens now.<\/p>",
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