Border crossing investment

JAKARTA (JP): A former minister suggested Saturday that Indonesia open its border areas to investors from adjacent countries in order to prepare itself for regional trade liberalization by the year 2003.

Emil Salim, former state minister for population and environment, urged the government to allow companies from adjacent countries to set up investment projects in border areas without having to get licenses from the Investment Coordinating Board under the spirit of the ASEAN Free Trade Agreement.

Under the agreement, the member countries of the Association of Southeast Asian Nations (ASEAN) are committed to liberalizing trade among themselves by the year 2003.

Citing an example, Emil said that the government should open North Sumatra and Aceh for investors from Thailand, Malaysia and Singapore.

The government should also open North Sulawesi for investors from the Philippines and East Nusa Tenggara for North Australian investors, he said.

Speaking about collateral-free loans which will be introduced by banks for small businesses, Emil said that such loans are expected to help solve property problems in the country.

The government announced recently that small businesses will be allowed to raise loans of up to Rp 50 million (US$ 22,200) without collateral. Such loans will be provided by state banks, which will be followed by private banks.

However, he urged the government to tighten the supervision of the loan program to prevent corruption and collusion. (05)