5,000 brokers to be trained this year

JAKARTA (JP): The Capital Market Society of Indonesia (CMS) will train 5,000 brokers this year as part of efforts to encourage local investor participation in the capital market, the society's executive director Joseph Luhukay said yesterday.

"The 5,000 brokers will be trained mostly in selling mutual funds. It is part of our program to train around 50,000 brokers for the capital market during the next five years," said Joseph.

Joseph spoke to the press after signing a memorandum of understanding with I Putu Gede Ary Suta, chairman of the Indonesian Capital Market Supervisory Agency (Bapepam), on the management of a Public Information Service Office.

The office, to be established as part of the Capital Market Reference Center, will provide data on companies listed on the Indonesian capital market.

Managed by CMS, the Capital Market Reference Center will become the capital market's information center and include a library.

Joseph noted brokers had a major role in encouraging the participation of local investors in the capital market, which was still dominated by foreign fund managers.

He said Indonesia had approximately 1,000 licensed brokers.

"This is very small compared to our population of almost 200 million. We need to have more, particularly to develop local mutual funds, the key to developing a domestic investor base," he said.

Putu said the number of brokers must be increased if the aim of having approximately five million local investors by the year 2000 was to be achieved.

But he said these new brokers should not only act as "brokering agents" on the trading floor. "They should be able to act as financial consultants for local investors," he said.

He cited the U.S. as an example, where 500,000 brokers served about 50 million local investors.

Joseph said there was a tendency on the international capital market for the brokers' job to no longer be limited to brokering activities on the trading floor.

Putu said most Indonesian brokers focused their attention on the trading floor, while brokers in developed markets often also act as financial consultants.

He urged the 200 securities firms in Indonesia to promote brokering jobs among university students. (bnt)