Sat, 05 Apr 2003

Council blasts governor over drop in investment

M. Taufiqurrahman, The Jakarta Post, Jakarta

Councillors blasted the city administration for failing to boost revenues as revealed by recent data from the Central Statistics Agency showing that foreign direct investment in the city fell precipitously by a staggering 93 percent from Rp 5.48 trillion (US$609 million) in 2001 to Rp 386 billion ($42.92 million) in 2002.

Khudri Hasbullah of the United Development faction said on Friday that the shocking investment figures had hampered the city administration's ability to provide jobs.

"This also shows that the city administration has its priorities wrong, by catering to the needs of the city officials, rather than stimulating economic growth in the city," he said in a budget hearing between the city councillors and Governor Sutiyoso.

Two other factions, the Justice Party (PK) and Crescent Star Party (PBB) at the council also shared the criticism.

The city strategic planning for 1998-2002 stipulated that in 2002 the administration should have focused great effort on developing businesses, creating employment and reforming the city bureaucracy.

The city councillors, however, did not put all the blame on the city administration for its failure to attract more investment in the city.

The United Development Party (PPP) faction cited the Bali terror attacks in October 2002 that claimed over 200 lives was greatly responsible for driving investors away from the country.

By comparison, in 2002, the national figure of foreign direct investment approvals -- excluding those in the energy and financial sectors -- plummeted by 35 percent to $9.7 billion from $15.06 billion in 2001.

Meanwhile, Abdul Aziz Matnur of the PK faction said that the city administration fell short of boosting the rate of the city's economic growth.

"The economic growth in 2002 was 3.87 percent, only 0.23 percentage point higher than 3.64 percent in 2001," Aziz said.

Economic growth this year has been forecasted to reach 4.62 percent.

Echoing his fellow councillors from PPP, Aziz said: "Slow economic growth and low investment will not create new jobs, while at the same time the city is still beset by more and more unemployment."

He said that in 2002, around 560,000 people were unemployed in Jakarta.

The councillors also highlighted the failure on the part of the city administration to generate any significant profits from the dozens of city-owned companies.

In 2002, profits earned by the city-owned companies reached Rp 43 billion far lower than the expected figure of Rp 64 billion.

The PPP faction also called on the city administration to replace the incompetent directors of the city-owned companies with people who were more professional.

"Fire those incompetent directors and establish a proper merit and punishment system so that those companies can thrive," he said.