'Don't be unrealistic about big cats meeting!'

'Don't be unrealistic about big cats meeting!'

A huge assembly of Indonesia's largest businessmen took place
in Bali last week. What is to be expected from this unprecedented
gathering? The Jakarta Post looks at the issue in an interview
with prominent economist Mari Pangestu.

Question: What is your general view about the Bali
Declaration?

Answer: First of all, it's something very special for big
businessmen from many different groups and fields of business to
sit down together like that. And they were not merely
representatives, but were the owners or top management executives
themselves. There has never been such a gathering before, except
in 1980, when a similar meeting was held, although on a smaller
scale.

Secondly, despite high expectations on the part of the people,
it's very unrealistic to expect a concrete program of action out
of such a gathering. The nature of such a meeting is such that it
is difficult for them to adopt such a concrete program.

So, I think, they tended to be very careful about making
promises, because they realized they might not be able to always
deliver on their promises, in some cases because of external
factors beyond their control. Moreover, since there is no
enforcement mechanism, we cannot expect anything very significant
from them -- unless they come under peer pressure.

Nevertheless, it is good that they realized the vital
importance of maintaining unity and declared their awareness
about the gap between giant and small businesses.

Q: What was the main theme of the meeting?

A: There were two themes they wanted to pursue. First, they
felt they had been constantly under fire over things they had not
felt were their responsibilities. They always pay their taxes,
they have their own social and charity programs and so on. Hence,
they wanted to improve their image; for example, by forming a
special task force or a forum to discuss social inequity.

The second theme was the need for businessmen to have a common
stance. Cynics may think that this is just rhetoric. But, being
united is important, especially in facing foreign competition.
Although companies basically compete with each other, businessmen
recognize the importance of unity to address domestic issues,
such as social inequity, inconsistencies in government
regulations and criticisms that conglomerates are irresponsible.

But, realistically, they can only unite when they have common
interests. So, let's not be too unrealistic, expecting some kind
of Indonesia Incorporated to conquer the world.

Q: Are you saying that Indonesian Inc. is something which is
impossible to accomplish?

A: No. It's not impossible. Only, once again, it's unrealistic
to expect too much from them.

Q: So, what are your suggestions?

A: There are certain characteristics you have incorporate if
you want to make the forum effective. First, you have to run it
as a loose structure. So don't try to institutionalize it,
because if you do that people will use it as a political tool.
The forum, therefore, has to be informal, using as many networks
as possible. The most important thing in running such an
organization is the commitment of the business people in charge.
They must be those with access both to the government and to the
business community itself.

Second, the forum has to focus on certain issues. Don't try to
cope with too many issues at once. Otherwise, it won't be
effective and will be difficult to be evaluated as well.

Q: What possible issues do you suggest?

A: The social inequity issue is one example. I don't know
whether this is going to be their priority. But they have agreed
to reduce the gap between giant companies and the small ones
through a partnership program. We may say that they are just
politicking, doing some public relations work. But I sincerely
hope they are really serious. There are indeed ways in which they
can achieve something.

Q: How would you see a partnership program working, without
becoming a charity program?

A: The first principle is: The program has to be mutually
beneficial. Second, if you want to help a smaller or less capable
partner, it is not just the funds that matters. Sometimes, you
don't have to drop big money but simply give them access to funds
and let them do the rest. Technical, management and marketing
assistance are sometimes more important than funds.

You have to treat it as a guidance and assistance program. So,
there has to be long-term commitment as well as a long term
vision. Third, the program has to be conducted voluntarily. We
cannot force anybody to participate in it. If we did it wouldn't
work as expected.

The last principle is: Such a program has to be carried out
professionally, by professional people who have a very good
understanding of small and middle-sized businesses.

Q: What about monopolies?

A: That's one of the problems they have to be concerned about.
Why? Because, there has been growing pressure for anti-monopoly
legislation. My impression, though, is that we, and even the
government and the business community, don't yet know what
provisions should be contained in such legislation.

Q: Other suggestions?

A: Besides the government and business groups, the forum must
also include representatives from outside those two sectors in
order for the forum to be independent. This is the kind of group
that will represent the national interest. (swa)

Mari Pangestu is head of the economics department of the
Centre for Strategic and International Studies in Jakarta..