Business revival key to nation's security

Business revival key to nation's security

Wimar Witoelar, InterMatrix Communications, Jakarta, wimar@witoelar.com

As Indonesia licks its wounds form the nation's latest
tragedy, the outside world increases its pressure not just on
potential terrorists, but on anyone who happens to be
circumstantially linked to the al-Qaeda and the Jamaah Islamiyah.
They are not our only problem. The world should know domestic
terrorists have plagued us for a long time. As the professor
Jeffrey Winters enumerated in his recent article Did the al-Qaeda
really do it?, six bombs were detonated in 1998, nine in 1999, 20
in 2000, and seven in 2001.

Not too many people wept for Indonesia internationally then as
they do now for Bali. It is actually the same show of terror made
worse by the addition of international victims which puts it on
an international stage.

But while New York after Sept. 11 received a huge outpouring
of support and sympathy, Indonesia receives recrimination and
suspicion even as we are still weeping at our huge loss.
Travelers are advised to stay away from Indonesia while they were
not told to stay away from New York. A scaremonger in Brisbane's
Courier-Mail even described Jakarta as a "city of fear". Actually
the most fearful thing about Jakarta is that it may be pushed off
the map before people get a chance to know its chaotic charm.

Wile international terror is still under investigation,
international business has condemned Indonesia as a hopeless
place to do business. We are losing big in the international
public relations and media game. As long as the al-Qaeda elude
George W. Bush, we get pushed on a downward spiral with the
collapse of our international business image.

Singapore might complain about being put on the Australian
government's travel advisory list as a dangerous place to visit,
but at least their business credibility is still intact. They
just reached an agreement with Australia on a free trade deal,
which could generate hundreds of millions of dollars in export
revenue for both sides. The Australian Trade Minister sent a
clear signal that Australia is going to remain there and increase
their engagement throughout Southeast Asia. They are negotiating
with Thailand and remain open to offers to negotiate similar
deals. Is Indonesia on their agenda? Probably not, to put it
succinctly.

At the ASEAN summit in Cambodia, Japan will tantalize
Southeast Asian leaders with talk of free-trade agreements and
closer relations. Japanese Prime Minister Junichiro Koizumi has
announced that the proposed trade agreement will be high on the
agenda when he meets with ASEAN leaders on Tuesday. We have no
idea how our own President Megawati Soekarnoputri will perform;
we do not expect overly joyous news.

It is highly uncertain whether Indonesia will be able to share
the recovery of international business. But this is not
exclusively related to the terrorism issue. We have many foreign
business people still operating in Indonesia, and multinational
firms committed to stay for years, even decades. They feel quite
safe, at least normal, in their everyday rounds.

These people make up the international business community that
we should court. A management guru at IBM once revealed a study
that showed gaining new customers costs 12 times as expensive as
retaining old ones. We have so many international names here that
mentioning them would make this article look like an
advertisement. But they are pressed against the wall when their
bosses and owners ask back home ask why they still have hope in
Indonesia.

For business people who have long experience and good
knowledge of Indonesia, the issue is not terrorism, which has
turned global. They are facing a more serious problem, a truly
debilitating disease in the form of an uncertain business
environment, poorly articulated policies left undefended. The
business-political system leaves the reform attempts vulnerable
to cooption and sabotage.

The battle for clean government and good corporate governance
has always been difficult but now it has become a losing one.
Legal uncertainty has reached the level of celebrated cases.
Other crises are brewing in the background. There is a prevalence
of regional insubordination to central authority. Further
problems come from political opportunists who exploit public
ignorance about foreign investment and privatization.

In terms of business recovery, these are the real terrorists
whom the international war on terror leave unscathed. When you
look at the due of corruption and violence, corruption is left
unchecked by our government while perpetrators of violence are
getting merciful treatment by foreign governments eager to work
with the military.

It is disappointing to hear of groups who are fishing in
troubled waters. Instead of strengthening the market economy,
they seek to stop the government privatization program through
class action suits. These misguided ideas are expressed in
demonstrations and unilateral declarations against legal
authority. There is wry humor here considering that the
government has not been particularly forceful about privatization
anyway.

Populist politicians play to the uninformed public by
depicting privatization as loss of local ownership and
international acquisition as a takeover by foreigners to send
Indonesians deeper into poverty. They draw parallel lines of
xenophobia along political and economic themes.

The public stands to increase their chances against poverty
through privatization. The market takes control away from
bureaucrats and corrupt management. That is why these groups of
people drag their feet on privatization. They are worried about
their own privileged positions, not the public interest. The
government would be much less in debt if their privatization were
pursued with more energy. In fact, the reason the national budget
faces problems is because privatization targets for cash revenues
are not being met.

It takes a lot of patience and sensitivity to explain these
things, but it has to be started. The worry now is that Indonesia
is going to be trampled in the world hunt for terrorists, and
that business will suffer. We should position ourselves such that
we all join hands in making the world safe from terrorists.

But it is business recovery that will make Indonesia a better
place for its people. And it would make it less fertile for hate-
spreading radicals and scare mongering overseas writers.