Corruptions hurts the growth of small businesses

Corruptions hurts the growth of small businesses

JAKARTA (JP): Corruption and collusion between government
officials and businessmen have hampered the growth of small
businesses because they channel most of the credit from state
banks to large entities, legislator A.A. Baramuli said here
Saturday.

Speaking at a one-day seminar on the Success of Malaysian
Indigenous Enterprises, conducted by the Association of
Indonesian Moslem Intellectuals (ICMI), Baramuli said many
Indonesian officials have special relations with conglomerate
owners.

He said the recent Rp 1.3 trillion (US$620 million) loan
scandal at Bank Pembangunan Indonesia (Bapindo), which involved
businessman Eddy Tansil and a number of officials, serves as a
good example of collusion between Indonesian officials with
businessmen.

Baramuli, the man who uncovered the Bapindo scandal a few
months ago, listed a number of cases of collusion that he
discovered during his time as an executive of the Indonesian
Chamber of Commerce and Industry (Kadin) from 1973 through 1983.

"Once an indigenous businessman wanted to acquire a permit to
appropriate a two-hectare plot for his project but he couldn't
get it. At the same time, another businessman got an
appropriation permit for a plot of almost one thousand hectares
that overlapped the same location.

"It turned out that the second businessman had special
relations with an official who had the authority to issue the
permit and that the businessman involved some family members of
the official in the business," Baramuli said.

Fighting crime

In corruption cases, Baramuli noted that Indonesia has long
had a legal weapon to combat it -- the 1971 Anti Corruption Law.
"However, it is seldom enforced only because of the low character
of our bureaucrats," he said.

Baramuli -- who is also a vice chairman of Kadin's advisory
board -- noted that because of lack of morality of many
Indonesian officials, the country's economy has been dominated by
a few conglomerate owners which control over 70 percent of the
country's business assets.

Baramuli said Malaysia is one step ahead in combating
corruption among its officials and in treating indigenous
enterprises.

"The business environment in Malaysia truly benefits
indigenous enterprises, as they are protected by law. The
positive role of Malaysian bureaucracy is supported by its Anti
Corruption Agency Act, which they have the will and the ability
to enforce," Baramuli told seminar participants, including
Malaysian indigenous businessmen.

In fighting corruption, Baramuli said that Malaysian
authorities are equipped with three legal tools -- the 1961
Prevention of Corruption Act, revised in 1971, the 1970 Emergency
(Essential Powers) Ordinance and the 1982 Anti Corruption Agency
Act. (rid)