BKPM chief lashes out at media

BKPM chief lashes out at media

The Jakarta Post, Nusa Dua, Bali

Chairman of the Investment Coordinating Board (BKPM) Theo
Toemion lashed out at the media for exaggerating the country's
problems, which in turn had created a "negative perception" of
the investment climate.

Theo said that during talks with investors, he had often been
repeatedly bombarded with negative remarks on increased
corruption, inefficient bureaucracy, messy decentralization
procedures, inadequate legal certainty, a confusing political
process and recently a "haven for terrorists."

He claimed that the government had actually begun to address
such problems and the local media only liked to highlight the
difficulties, thus leading the international press to be deceived
and write exaggerated reports about the country's problems.

"Unfortunately, the media has not been kind enough to
recognize our efforts to deal with these issues. Our free press
encourages our writers to freely highlight our difficulties,
rather than give some credit to our government for trying to
improve.

"The International press takes its cue from our local reports
and further exaggerates our problems by perpetuating an adverse
perception on our investment climate," he told hundreds of local
and foreign businessmen at the second-day of the first ASEAN
Business and Investment Summit.

"This is a self-fulfilling negativism and scares investors to
move us off their investment map... It is discouraging and 'de-
motivating'."

Theo appealed to the media to present a more balanced picture
on Indonesia's investment climate and give credit to the
government for whatever efforts it has made to resolve the
various problems.

Foreign direct investment into the country has significantly
weakened since the late 1990s economic and political crisis. The
recent outbreak of Severe Acute Respiratory Syndrome (SARS) and
terrorist bomb attacks including those in Bali and in Jakarta
have further aggravated the situation.

Although the government and the central bank have managed to
bring about a semblance of stability in some of the country's
macroeconomic indicators, it has yet to translate into brisk
investment activities.

The low investment level has caused the country's economy to
grow at a relatively meager rate of around 3 percent to 4 percent
during the past couple of years as it has become increasingly
reliant on domestic consumption. In order for the government to
push growth to pre-crisis levels of around 7 percent, enough to
be able to create more jobs to millions of new job seekers each
year, investment has to play a more significant role.

Theo urged investors to return to the country because the
government had prepared to take a number of steps to address its
problems.

He said that plans to set up the so-called National Team for
Investment and Exports could soon be acted upon.

The team, which will be chaired by the President and include
Cabinet members, will try to address the complex bureaucracy and
other problems relating to various conflicting government
regulations.

Theo added that the investment coordinating board would
provide a "one roof" service facility to help streamline
investment procedures for "qualified investors". Meaning that
all licensing approvals could be located within the BKPM. Many
ministers, however, have openly opposed the plan, as they are
concerned that such streamlined procedures would not be
"effective".

Theo said that the BKPM would soon submit the country's long-
awaited investment bill to the House of Representatives for
approval.

The key features are unification of the existing investment
laws on foreign and domestic investment, commitments on freedom
to invest, and delineation of authority between the central and
regional governments.

"The enactment of this law should provide a comforting
assurance for investors," Theo said.

"Under the new law, we are hoping to be able to provide
additional investment incentives to those who meet the qualifying
criteria."

He added that the government was also planning to reduce the
number of 'closed' sectors, to allow foreign or joint venture
companies to operate in other sectors, not including defense, the
environment, religion or health because of the importance to
keeping those in the hands of local citizens exclusively.